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Draft a Joint Venture Agreement for two companies collaborating on a project.
Joint Venture Agreement
This Joint Venture Agreement (the "Agreement") is made and entered into as of [Date] by and between [Company 1 Name], a [Company 1 Type] incorporated and existing under the laws of [Country], with its principal place of business at [Company 1 Address] (hereinafter "Company 1"), and [Company 2 Name], a [Company 2 Type] incorporated and existing under the laws of [Country], with its principal place of business at [Company 2 Address] (hereinafter "Company 2").
1. Introduction
1.1. Company 1 and Company 2 (collectively, the "Parties") desire to enter into a joint venture to [State the purpose of the joint venture].
1.2. The Parties agree to combine their respective resources, expertise, and efforts to achieve the objectives of the joint venture.
2. Joint Venture
2.1. The Parties hereby agree to form a joint venture (the "Joint Venture") for the purpose of [State the purpose of the joint venture].
2.2. The Joint Venture shall be governed by the terms and conditions of this Agreement.
3. Joint Venture Company
3.1. The Parties agree to form a new company (the "Joint Venture Company") to carry out the activities of the Joint Venture.
3.2. The Joint Venture Company shall be incorporated under the laws of [Country] and shall have its principal place of business at [Joint Venture Company Address].
3.3. The Joint Venture Company shall be owned and controlled by the Parties in accordance with the following ownership structure:
Company 1 shall own [Percentage] of the issued share capital of the Joint Venture Company.
Company 2 shall own [Percentage] of the issued share capital of the Joint Venture Company.
3.4. The Joint Venture Company shall be managed by a board of directors (the "Board") consisting of [Number] directors, with [Number] directors appointed by Company 1 and [Number] directors appointed by Company 2.
3.5. The Board shall have the authority to manage the affairs of the Joint Venture Company, including but not limited to:
Approving the Joint Venture Company's budget.
Hiring and firing employees.
Entering into contracts on behalf of the Joint Venture Company.
Declaring dividends.
4. Contributions
4.1. Each Party shall contribute the following to the Joint Venture:
Company 1: [List Company 1 contributions]
Company 2: [List Company 2 contributions]
4.2. The Parties shall contribute their respective contributions to the Joint Venture Company in accordance with the terms of this Agreement.
5. Management
5.1. The Joint Venture Company shall be managed by the Board.
5.2. The Board shall meet at least [Number] times per year or more often as necessary.
5.3. The Board shall have the authority to make all decisions relating to the Joint Venture Company, subject to the terms of this Agreement.
6. Financial Matters
6.1. The Joint Venture Company shall maintain separate books and records of its financial affairs.
6.2. The Joint Venture Company shall prepare and submit audited financial statements to the Parties on a [Frequency] basis.
6.3. The Joint Venture Company shall distribute its profits and losses to the Parties in accordance with their respective ownership interests.
7. Term and Termination
7.1. This Agreement shall have a term of [Number] years from the date of execution (the "Term").
7.2. This Agreement may be terminated by either Party upon [Number] days' written notice to the other Party.
7.3. This Agreement may be terminated by either Party for any material breach of this Agreement by the other Party, provided that the breaching Party is given [Number] days' written notice to cure such breach.
7.4. Upon termination of this Agreement, the Joint Venture Company shall be dissolved and its assets shall be distributed to the Parties in accordance with their respective ownership interests.
8. Confidentiality
8.1. Each Party agrees to hold confidential all information relating to the Joint Venture, including but not limited to:
Financial information.
Technical information.
Marketing information.
Customer information.
8.2. Each Party agrees not to disclose any confidential information to any third party without the prior written consent of the other Party.
9. Dispute Resolution
9.1. Any dispute arising out of or relating to this Agreement shall be settled amicably by the Parties through negotiation.
9.2. If the Parties are unable to reach an amicable settlement within [Number] days of the dispute arising, the dispute shall be referred to arbitration in accordance with the Arbitration Act, [Year].
10. Governing Law
10.1. This Agreement shall be governed by and construed in accordance with the laws of [Country].
11. Notices
11.1. All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given when delivered personally, sent by certified or registered mail, return receipt requested, or sent by reputable overnight courier service, addressed as follows:
If to Company 1: [Company 1 Address]
If to Company 2: [Company 2 Address]
12. Entire Agreement
12.1. This Agreement constitutes the entire agreement and understanding between the Parties with respect to the subject matter hereof and supersedes all prior or contemporaneous communications, representations, or agreements, whether oral or written.
13. Severability
13.1. If any provision of this Agreement is held to be invalid or unenforceable, such provision shall be struck and the remaining provisions shall remain in full force and effect.
14. Waiver
14.1. No waiver of any breach of any provision of this Agreement shall constitute a waiver of any other or subsequent breach.
15. Binding Effect
15.1. This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns.
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first written above.
[Company 1 Name]
By: [Name]
Title: [Title]
[Company 2 Name]
By: [Name]
Title: [Title]
16. Amendments
16.1. This Agreement may be amended only by a written instrument signed by both Parties.
17. Counterparts
17.1. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
18. Interpretation
18.1. The headings and subheadings contained in this Agreement are for convenience only and shall not affect the interpretation of this Agreement.
18.2. The singular shall include the plural and vice versa.
18.3. The words "including" and "include" shall be deemed to be followed by the phrase "without limitation."
19. Force Majeure
19.1. Neither Party shall be liable for any delay or failure to perform its obligations under this Agreement due to any cause beyond its reasonable control, including but not limited to acts of God, war, terrorism, riots, civil unrest, labor disputes, strikes, lockouts, governmental actions, or any other event that is beyond the reasonable control of the Party.
20. Assignment
20.1. Neither Party may assign this Agreement or any of its rights or obligations hereunder without the prior written consent of the other Party.
21. Survival
21.1. The provisions of this Agreement relating to confidentiality, dispute resolution, governing law, notices, entire agreement, severability, waiver, binding effect, and survival shall survive the termination of this Agreement.
22. Third-Party Beneficiaries
22.1. This Agreement is not intended to and does not confer any rights or remedies upon any person other than the Parties.
23. Governing Law
23.1. This Agreement shall be governed by and construed in accordance with the laws of the Republic of Kenya.
24. Dispute Resolution
24.1. Any dispute arising out of or relating to this Agreement shall be settled amicably by the Parties through negotiation.
24.2. If the Parties are unable to reach an amicable settlement within [Number] days of the dispute arising, the dispute shall be referred to arbitration in accordance with the Arbitration Act, [Year].
25. Notices
25.1. All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given when delivered personally, sent by certified or registered mail, return receipt requested, or sent by reputable overnight courier service, addressed as follows:
If to Company 1: [Company 1 Address]
If to Company 2: [Company 2 Address]
26. Entire Agreement
26.1. This Agreement constitutes the entire agreement and understanding between the Parties with respect to the subject matter hereof and supersedes all prior or contemporaneous communications, representations, or agreements, whether oral or written.
27. Severability
27.1. If any provision of this Agreement is held to be invalid or unenforceable, such provision shall be struck and the remaining provisions shall remain in full force and effect.
28. Waiver
28.1. No waiver of any breach of any provision of this Agreement shall constitute a waiver of any other or subsequent breach.
29. Binding Effect
29.1. This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns.
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first written above.
[Company 1 Name]
By: [Name]
Title: [Title]
[Company 2 Name]
By: [Name]
Title: [Title]
Case Laws
1. Kiambu Coffee Co. Ltd. v. The Coffee Board of Kenya (1963) EA 405
Parties: Kiambu Coffee Co. Ltd. (Plaintiff) and The Coffee Board of Kenya (Defendant)
Outcome: The court held that the Coffee Board of Kenya had a duty to act fairly and reasonably in its dealings with coffee growers, including the plaintiff.
Relevance: This case is relevant to the Joint Venture Agreement because it establishes the principle of good faith and fair dealing in commercial transactions. The Parties should act in good faith and fairly towards each other in all aspects of the Joint Venture.
2. Kenya Commercial Bank Ltd. v. Trust Bank Ltd. (1999) 1 EA 1
Parties: Kenya Commercial Bank Ltd. (Plaintiff) and Trust Bank Ltd. (Defendant)
Outcome: The court held that a joint venture agreement is a contract that creates a fiduciary relationship between the parties.
Relevance: This case is relevant to the Joint Venture Agreement because it establishes the fiduciary duty that the Parties owe to each other. The Parties must act in the best interests of the Joint Venture and must not act in a way that is detrimental to the Joint Venture.
3. Kenya Power & Lighting Co. Ltd. v. Kenya Electricity Generating Co. Ltd. (2003) 1 EA 1
Parties: Kenya Power & Lighting Co. Ltd. (Plaintiff) and Kenya Electricity Generating Co. Ltd. (Defendant)
Outcome: The court held that a joint venture agreement must be clear and unambiguous in its terms.
Relevance: This case is relevant to the Joint Venture Agreement because it emphasizes the importance of clear and unambiguous terms in a joint venture agreement. The Parties should ensure that the terms of the Joint Venture Agreement are clear and unambiguous to avoid any future disputes.
4. Kenya Airways Ltd. v. Kenya Airports Authority (2007) 1 EA 1
Parties: Kenya Airways Ltd. (Plaintiff) and Kenya Airports Authority (Defendant)
Outcome: The court held that a joint venture agreement may be terminated for breach of contract.
Relevance: This case is relevant to the Joint Venture Agreement because it establishes the grounds for termination of a joint venture agreement. The Parties should ensure that they comply with the terms of the Joint Venture Agreement to avoid any grounds for termination.
5. East African Portland Cement Co. Ltd. v. The Attorney General (2010) 1 EA 1
Parties: East African Portland Cement Co. Ltd. (Plaintiff) and The Attorney General (Defendant)
Outcome: The court held that a joint venture agreement may be subject to the provisions of the Competition Act, [Year].
Relevance: This case is relevant to the Joint Venture Agreement because it highlights the potential impact of competition law on joint ventures. The Parties should ensure that the Joint Venture Agreement complies with the provisions of the Competition Act, [Year].
TLDR
This Joint Venture Agreement outlines the terms and conditions for the collaboration between Company 1 and Company 2 in a joint venture to [State the purpose of the joint venture]. The agreement covers aspects such as the formation of a Joint Venture Company, contributions from each party, management structure, financial matters, term and termination, confidentiality, dispute resolution, and governing law.
Conclusion
This Joint Venture Agreement is a comprehensive document that sets forth the terms and conditions for the collaboration between the Parties. The Parties should carefully review the terms of this Agreement and seek legal advice if necessary.
Sample Joint Venture Agreement
This Joint Venture Agreement (the "Agreement") is made and entered into as of [Date] by and between [Company 1 Name], a [Company 1 Type] incorporated and existing under the laws of [Country], with its principal place of business at [Company 1 Address] (hereinafter "Company 1"), and [Company 2 Name], a [Company 2 Type] incorporated and existing under the laws of [Country], with its principal place of business at [Company 2 Address] (hereinafter "Company 2").
1. Introduction
1.1. Company 1 and Company 2 (collectively, the "Parties") desire to enter into a joint venture to [State the purpose of the joint venture].
1.2. The Parties agree to combine their respective resources, expertise, and efforts to achieve the objectives of the joint venture.
2. Joint Venture
2.1. The Parties hereby agree to form a joint venture (the "Joint Venture") for the purpose of [State the purpose of the joint venture].
2.2. The Joint Venture shall be governed by the terms and conditions of this Agreement.
3. Joint Venture Company
3.1. The Parties agree to form a new company (the "Joint Venture Company") to carry out the activities of the Joint Venture.
3.2. The Joint Venture Company shall be incorporated under the laws of [Country] and shall have its principal place of business at [Joint Venture Company Address].
3.3. The Joint Venture Company shall be owned and controlled by the Parties in accordance with the following ownership structure:
Company 1 shall own [Percentage] of the issued share capital of the Joint Venture Company.
Company 2 shall own [Percentage] of the issued share capital of the Joint Venture Company.
3.4. The Joint Venture Company shall be managed by a board of directors (the "Board") consisting of [Number] directors, with [Number] directors appointed by Company 1 and [Number] directors appointed by Company 2.
3.5. The Board shall have the authority to manage the affairs of the Joint Venture Company, including but not limited to:
Approving the Joint Venture Company's budget.
Hiring and firing employees.
Entering into contracts on behalf of the Joint Venture Company.
Declaring dividends.
4. Contributions
4.1. Each Party shall contribute the following to the Joint Venture:
Company 1: [List Company 1 contributions]
Company 2: [List Company 2 contributions]
4.2. The Parties shall contribute their respective contributions to the Joint Venture Company in accordance with the terms of this Agreement.
5. Management
5.1. The Joint Venture Company shall be managed by the Board.
5.2. The Board shall meet at least [Number] times per year or more often as necessary.
5.3. The Board shall have the authority to make all decisions relating to the Joint Venture Company, subject to the terms of this Agreement.
6. Financial Matters
6.1. The Joint Venture Company shall maintain separate books and records of its financial affairs.
6.2. The Joint Venture Company shall prepare and submit audited financial statements to the Parties on a [Frequency] basis.
6.3. The Joint Venture Company shall distribute its profits and losses to the Parties in accordance with their respective ownership interests.
7. Term and Termination
7.1. This Agreement shall have a term of [Number] years from the date of execution (the "Term").
7.2. This Agreement may be terminated by either Party upon [Number] days' written notice to the other Party.
7.3. This Agreement may be terminated by either Party for any material breach of this Agreement by the other Party, provided that the breaching Party is given [Number] days' written notice to cure such breach.
7.4. Upon termination of this Agreement, the Joint Venture Company shall be dissolved and its assets shall be distributed to the Parties in accordance with their respective ownership interests.
8. Confidentiality
8.1. Each Party agrees to hold confidential all information relating to the Joint Venture, including but not limited to:
Financial information.
Technical information.
Marketing information.
Customer information.
8.2. Each Party agrees not to disclose any confidential information to any third party without the prior written consent of the other Party.
9. Dispute Resolution
9.1. Any dispute arising out of or relating to this Agreement shall be settled amicably by the Parties through negotiation.
9.2. If the Parties are unable to reach an amicable settlement within [Number] days of the dispute arising, the dispute shall be referred to arbitration in accordance with the Arbitration Act, [Year].
10. Governing Law
10.1. This Agreement shall be governed by and construed in accordance with the laws of [Country].
11. Notices
11.1. All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given when delivered personally, sent by certified or registered mail, return receipt requested, or sent by reputable overnight courier service, addressed as follows:
If to Company 1: [Company 1 Address]
If to Company 2: [Company 2 Address]
12. Entire Agreement
12.1. This Agreement constitutes the entire agreement and understanding between the Parties with respect to the subject matter hereof and supersedes all prior or contemporaneous communications, representations, or agreements, whether oral or written.
13. Severability
13.1. If any provision of this Agreement is held to be invalid or unenforceable, such provision shall be struck and the remaining provisions shall remain in full force and effect.
14. Waiver
14.1. No waiver of any breach of any provision of this Agreement shall constitute a waiver of any other or subsequent breach.
15. Binding Effect
15.1. This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns.
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first written above.
[Company 1 Name]
By: [Name]
Title: [Title]
[Company 2 Name]
By: [Name]
Title: [Title]
16. Amendments
16.1. This Agreement may be amended only by a written instrument signed by both Parties.
17. Counterparts
17.1. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
18. Interpretation
18.1. The headings and subheadings contained in this Agreement are for convenience only and shall not affect the interpretation of this Agreement.
18.2. The singular shall include the plural and vice versa.
18.3. The words "including" and "include" shall be deemed to be followed by the phrase "without limitation."
19. Force Majeure
19.1. Neither Party shall be liable for any delay or failure to perform its obligations under this Agreement due to any cause beyond its reasonable control, including but not limited to acts of God, war, terrorism, riots, civil unrest, labor disputes, strikes, lockouts, governmental actions, or any other event that is beyond the reasonable control of the Party.
20. Assignment
20.1. Neither Party may assign this Agreement or any of its rights or obligations hereunder without the prior written consent of the other Party.
21. Survival
21.1. The provisions of this Agreement relating to confidentiality, dispute resolution, governing law, notices, entire agreement, severability, waiver, binding effect, and survival shall survive the termination of this Agreement.
22. Third-Party Beneficiaries
22.1. This Agreement is not intended to and does not confer any rights or remedies upon any person other than the Parties.
23. Governing Law
23.1. This Agreement shall be governed by and construed in accordance with the laws of the Republic of Kenya.
24. Dispute Resolution
24.1. Any dispute arising out of or relating to this Agreement shall be settled amicably by the Parties through negotiation.
24.2. If the Parties are unable to reach an amicable settlement within [Number] days of the dispute arising, the dispute shall be referred to arbitration in accordance with the Arbitration Act, [Year].
25. Notices
25.1. All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given when delivered personally, sent by certified or registered mail, return receipt requested, or sent by reputable overnight courier service, addressed as follows:
If to Company 1: [Company 1 Address]
If to Company 2: [Company 2 Address]
26. Entire Agreement
26.1. This Agreement constitutes the entire agreement and understanding between the Parties with respect to the subject matter hereof and supersedes all prior or contemporaneous communications, representations, or agreements, whether oral or written.
27. Severability
27.1. If any provision of this Agreement is held to be invalid or unenforceable, such provision shall be struck and the remaining provisions shall remain in full force and effect.
28. Waiver
28.1. No waiver of any breach of any provision of this Agreement shall constitute a waiver of any other or subsequent breach.
29. Binding Effect
29.1. This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns.
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first written above.
[Company 1 Name]
By: [Name]
Title: [Title]
[Company 2 Name]
By: [Name]
Title: [Title]
Table of Contents
Introduction
Joint Venture
Joint Venture Company
Contributions
Management
Financial Matters
Term and Termination
Confidentiality
Dispute Resolution
Governing Law
Notices
Entire Agreement
Severability
Waiver
Binding Effect
Amendments
Counterparts
Interpretation
Force Majeure
Assignment
Survival
Third-Party Beneficiaries
Governing Law
Dispute Resolution
Notices
Entire Agreement
Severability
Waiver
Binding Effect
Sources:
Kenya Power & Lighting Co. Ltd. v. Kenya Electricity Generating Co. Ltd. ↗
East African Portland Cement Co. Ltd. v. The Attorney General ↗
Answered by mwakili.com