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Provide a template for a Joint Venture Agreement in a real estate development project

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Introduction

A Joint Venture Agreement (JVA) is a legal document that outlines the terms and conditions under which two or more parties agree to undertake a specific business venture together. In the context of a real estate development project in Kenya, a JVA is crucial for defining the roles, responsibilities, and financial contributions of each party involved. This template will provide a comprehensive structure for a JVA, ensuring that all necessary legal aspects are covered.

Parties to the Agreement
Recitals
Definitions
Purpose of the Joint Venture
Capital Contributions
Management and Control
Duties and Responsibilities
Profit and Loss Sharing
Bank Accounts and Financial Management
Transfer of Interests
Confidentiality
Dispute Resolution
Termination
Governing Law
Miscellaneous Provisions
Signatures

1. Parties to the Agreement

This Joint Venture Agreement ("Agreement") is made and entered into as of [Date], by and between:

Party A: [Full Legal Name], a [Type of Entity, e.g., Limited Liability Company] organized and existing under the laws of Kenya, with its principal office located at [Address].
Party B: [Full Legal Name], a [Type of Entity, e.g., Limited Liability Company] organized and existing under the laws of Kenya, with its principal office located at [Address].

2. Recitals

WHEREAS, Party A and Party B desire to enter into a joint venture for the purpose of developing a real estate project located at [Project Location];
WHEREAS, the parties wish to define their respective rights and obligations with respect to the joint venture;

3. Definitions

"Agreement": This Joint Venture Agreement.
"Project": The real estate development project located at [Project Location].
"Capital Contribution": The amount of money or value of property each party contributes to the joint venture.
"Net Profits": The profits of the joint venture after all expenses have been deducted.

4. Purpose of the Joint Venture

The purpose of this joint venture is to develop, construct, market, and sell the real estate project located at [Project Location].

5. Capital Contributions

Initial Contributions: Each party agrees to make an initial capital contribution as follows:
- Party A: [Amount in KES or description of property]
- Party B: [Amount in KES or description of property]
Additional Contributions: Any additional capital contributions required for the project shall be made by mutual agreement of the parties.

6. Management and Control

Management Committee: The joint venture shall be managed by a Management Committee consisting of [Number] representatives from each party.
Decision-Making: Decisions of the Management Committee shall be made by a majority vote, except for major decisions which shall require unanimous consent.

7. Duties and Responsibilities

Party A: [Detailed description of Party A's duties and responsibilities]
Party B: [Detailed description of Party B's duties and responsibilities]

8. Profit and Loss Sharing

Profit Sharing: Net profits of the joint venture shall be distributed as follows:
- Party A: [Percentage]
- Party B: [Percentage]
Loss Sharing: Any losses incurred by the joint venture shall be shared as follows:
- Party A: [Percentage]
- Party B: [Percentage]

9. Bank Accounts and Financial Management

Bank Accounts: The joint venture shall maintain separate bank accounts for the project.
Financial Records: Accurate financial records shall be maintained and shall be available for inspection by either party upon reasonable notice.

10. Transfer of Interests

Restrictions on Transfer: Neither party may transfer its interest in the joint venture without the prior written consent of the other party.
Right of First Refusal: If a party wishes to sell its interest, the other party shall have the right of first refusal to purchase the interest on the same terms.

11. Confidentiality

Confidential Information: Each party agrees to keep confidential all information relating to the joint venture and the project, except as required by law.

12. Dispute Resolution

Negotiation: The parties shall first attempt to resolve any disputes through good faith negotiations.
Arbitration: If negotiations fail, disputes shall be resolved by arbitration in accordance with the Arbitration Act, 1995 (Cap 49).

13. Termination

Termination Events: The joint venture may be terminated upon the occurrence of any of the following events:
- Completion of the project and distribution of all profits.
- Mutual agreement of the parties.
- Material breach of this Agreement by either party.
Winding Up: Upon termination, the joint venture shall be wound up and any remaining assets shall be distributed in accordance with the parties' capital contributions.

14. Governing Law

This Agreement shall be governed by and construed in accordance with the laws of Kenya.

15. Miscellaneous Provisions

Entire Agreement: This Agreement constitutes the entire agreement between the parties and supersedes all prior agreements and understandings.
Amendments: Any amendments to this Agreement must be in writing and signed by both parties.
Severability: If any provision of this Agreement is found to be invalid or unenforceable, the remaining provisions shall remain in full force and effect.

16. Signatures

IN WITNESS WHEREOF, the parties hereto have executed this Joint Venture Agreement as of the day and year first above written.

Party A: [Signature, Name, Title]
Party B: [Signature, Name, Title]

Conclusion

This template provides a comprehensive structure for a Joint Venture Agreement in a real estate development project in Kenya. It covers all essential aspects, including capital contributions, management, profit and loss sharing, and dispute resolution. By clearly defining the roles and responsibilities of each party, this agreement helps to ensure a successful and mutually beneficial joint venture.