Exclusivity: neither party is required to do business only with the other co-venturer.Confidentiality: both parties agree to keep all proprietary information confidential.Assignment: neither party may assign the venture.Here are some other useful details a joint venture agreement might include: Term: whether the venture is for a limited time or indefinite period.Profits: how profits will be distributed, either based on contributions or another formula.Purpose: scope of JV activities and reason to join resources and collaborate.Management: the person responsible for the day-to-day operations of the venture.Contributions: how much money, property, or time each of the co-venturers will invest.Parties or Co-Venturers: the two entities that have agreed to work together.Instead of creating a formal partnership or new legal entity, a contractual joint venture (“JV”) allows the parties to continue filing their tax returns separately yet still reap the financial advantages of a partnership such as sharing resources and risks.Ī joint venture agreement will identify the following fundamental elements:
The Risks and Advantages of Forming a Joint VentureĪ joint venture agreement is a contract between two or more parties who want to do business together for a period of time.Unlike a partnership agreement, a joint venture only lasts until the end date outlined in the Joint Venture Agreement. A completed Joint Venture template should include details such as venture members, member responsibilities, venture goals, as well as the start and end date. A Joint Venture Agreement is a contract between two businesses or individuals who agree to work together to achieve a certain goal.
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