Joint Venture Agreement 2023 (guide + free templates)

This post covers joint venture agreement templates.

In this guide, I will take you through

  • what is a joint venture agreement
  • examples of joint venture agreement
  •  basic contents of joint venture agreement
  • joint venture agreement templates
  • etc

let’s get started

Meaning of joint venture agreement

A joint venture agreement means a contractual agreement between two or more parties for the purpose of carrying on a business.

in other words, A Joint Venture  Agreement is a legally binding contract between two or more business entities or individuals entering into a temporary business relationship to achieve a mutual goal.

A joint venture agreement outlines the conditions and commitments of the participants as well as their common objective.

Each party to a contract shares in the risk and reward, and by putting their agreement in writing, they can reduce disagreements.

Since a joint venture agreement is a binding legal contract, either party may file a lawsuit against the other if the other party fails to abide by its terms.

A joint venture agreement is governed by the contract law of a specific jurisdiction.

Other laws may have an impact on the venture depending on the parties involved and the nature of the business.

Examples of Joint Venture

A good real-world example of a Joint venture is the joint venture between BMW and Brilliance Auto Group.

BMW formed a joint venture with the Chinese Automobile manufacturer Brilliance Auto Group in 2003 to produce and sell BMW cars in China. The name of the Joint venture was BMW Brilliance

In that Joint venture, the venturers jointly agreed to invest €450 million in the Joint venture, in terms that BMW took a 50% stake in the Venture company while Brilliance Auto took a 40.5% stake.

The remaining 9.5% went to the Shenyang municipal government.

other examples of joint ventures include;

  1. Private persons – For example, independent contractors can combine resources through a joint venture to get a major contract to build a housing development.
  2. Corporations – For example, General Motors and Volvo Trucks formed a joint venture to build heavy-duty trucks. This is a joint venture instead of a partnership because the two companies conduct business separately except for this related series of transactions (manufacturing trucks).

Contents of Joint venture Agreement

To write a valid joint venture agreement make sure your agreement contains;

  1. Parties-venturers
  2. name of the joint venture
  3. duration of the joint venture
  4. nature of the business
  5. Capital contribution clause
  6. Rights, and duties of venturers
  7. Termination clause
  8. Dispute resolution clause
  9. Governing law clause
  10. Clause for control, influence, and power over the project or transaction.
  11. Insurance clause
  12. etc.

Joint venture agreement template

The following is the template of the joint venture agreement.

JOINT VENTURE AGREEMENT

THIS JOINT VENTURE is made on this………………day of……………….20…

BETWEEN

(1)_________________ of ____________________ (the “First Joint Venture”); and

(2)_________________ of ____________________ (the “Second Joint Venture”) hereinafter collectively

WHEREAS the parties to this Agreement have agreed to carry on the business of………………….in a joint venture under the name and style of………………..

AND WHEREAS the parties have agreed to execute this Joint Venture Agreement and to commence and carry on business in a joint venture on the following terms and conditions.

NOW THEREFORE THIS AGREEMENT WITNESSETH AS FOLLOWS.

Name

The name of the joint venture shall be……………….

Duration

The Joint Venture shall exist for a period of ……………years and shall commence from……….. The parties may renew the common venture by executing another Joint Venture Agreement. A party unwilling to renew the venture upon the lapse of the initial……………. years shall give a ………….. month advance notice of that intention, prior to the expiration of the Agreement period.

Business 

The main business of the Joint Venture shall be ………………and other allied businesses.

Both parties will be working venturers and thus actively engaged in the day-to-day operations of the business.

Capital

The parties have contributed towards the initial capital a sum of ………………..and ………………for the first and second party respectively.

The net profits and losses of the Venture will be shared by the parties in the proportion to the capital contribution. Net profits will mean the gross profits earned in such a year less the expenses of the business as recognized by accounting principles.

Ownership of Venture assets

All the tangible and intangible assets of the Venture including the goodwill, benefit of business licenses and permits, and benefits of contracts entered, shall belong to the parties in the proportion of capital contributed by each party.

Accounts

The parties shall open two accounts. One accounts for operational requirements and the other for savings purposes. The operational account may be accessed by any of the two parties. The account for savings shall only be operated and accessed upon the written authorization of both parties

Profits

Parties are entitled to a periodical distribution of…………….percent of the net profit. The interval of the distribution/ payment is to be determined from time to time by the Parties.

Object

This Agreement is not intended to create a Partnership and a party to the Agreement shall not have the authority to bind the other party in transactions with third parties unless the express consent of the other party has been secured.

Death of venturer

On the death of any party and there is no legal representative willing or capable to take the place of the deceased party, the share of the deceased party may be purchased by the remaining party at a valuation to be made by an arbitrator.

Termination 

A party desirous of prematurely terminating the joint venture shall give a………….month written notice of that intention to the other party. Unreasonable termination of the venture shall entitle the innocent party to fair compensation to offset the commercial inconvenience and loss resulting from the termination.

The premature termination of the Venture, unless resulting from the death of one of the parties shall be witnessed by a written resolution to that effect.

Governing Law

This joint venture shall be governed by the laws of …………..

IN WITNESS WHEREOF the parties put their respective hands on the day and year first above mentioned.

___________________________          ________________________________

Signed by or on behalf of the First Joint         Signed by or on behalf of the Second Joint
Venture                                                                   Venture

_________________________________      ________________________________

in presence of (witness)                                                   in presence of (witness)

Name ____________________________      Name ___________________________

Address___________________________     Address__________________________

_________________________________      ________________________________

Occupation________________________      Occupation _______________________

Joint venture agreement template #2

JOINT VENTURE AGREEMENT

THIS JOINT VENTURE AGREEMENT IS MADE on the____day of  _____

BETWEEN:

(1)_________________ of ____________________ (the “First Joint Venture”); and

(2)_________________ of ____________________ (the “Second Joint Venture”) hereinafter collectively called the “Joint Ventures”.

In consideration of the terms, conditions, and covenants  hereinafter set forth, the parties agree as follows:

The Joint Ventures hereby form a joint venture (the “Joint Venture”) for the purposes of the land development project and shall conduct business under the name ‘Landscape developers‘ at _________________.

The term of the Joint Venture shall be 10 calendar years from the date of executing this Agreement.

The capital of the Joint Venture shall consist of USD $10 Billion.

The First Joint  Venture shall contribute $ 7 billion and the Second Joint Venture shall contribute $ 3 Billion, which shall be deposited in _____________________ Bank plc and shall be disbursed only upon the signature of all the Joint Ventures.

The profits and losses of the Joint Venture shall be determined in accordance with good accounting practices and shall be shared among the Joint ventures in proportion to their respective capital contributions.

First Joint venture shall have the sole discretion, management, and entire control of the conduct of the business of the Joint Venture as the “Ventur Manager.”

As compensation for his services the Venture Manager shall be paid $1,000 per  Month during the duration of the Joint Venture and shall be reimbursed for all reasonable expenses incurred in the performance of his duties as Venture Manager.

Each Joint Venture shall be bound by any action taken by the Venture Manager in good faith under this agreement. In no event shall any Joint Venture be called upon to pay any amount beyond the liability arising against him on account of his capital contribution.

The Venture Manager shall not be liable for any error in judgment or any mistake of law or fact or any act done in good faith in the exercise of the power and authority as Venture Manager, but shall be liable for gross negligence or willful default.

The relationship between the Joint Ventures shall be limited to the performance of the terms and conditions of this agreement. Nothing herein shall be construed to create a general partnership between the Joint Venture or to authorize any Venture to act as a general agent for another, or to permit any Joint Venture to bind the other except as set forth in this agreement, or to borrow money on behalf of another Joint Venture, or to use the credit of any Joint Venture for any purpose.

Neither this Agreement nor any interest in the Joint Venture may be assigned without the prior written consent of the Joint Venture hereto.

This agreement shall be governed by and interpreted under the laws of …….. Any claim arising out of or relating to this agreement, or the breach thereof, shall be settled by arbitration in accordance with …………………. Act and judgment upon the award rendered by the Arbitrators(s) may be entered in a court having jurisdiction thereof.

Any and all notices to be given pursuant to or under this agreement shall be sent to the party to whom the notice is addressed at the Joint Venture maintained by Joint Venture.

This agreement constitutes the entire agreement between the Joint Venture pertaining to the subject matter contained in it, and supersedes all prior and contemporaneous agreements, representations, warranties, and understandings of the parties. No supplement, variation, or amendment of this agreement shall be binding unless executed in writing by all the parties hereto. No waiver of any of the provisions of this agreement shall be deemed or shall constitute a continuing waiver. No waiver shall be binding unless in writing signed by the party making the waiver.

IN WITNESS OF WHICH the parties have signed this agreement the day and year first above written

___________________________          ________________________________

Signed by or on behalf of the First Joint         Signed by or on behalf of the Second Joint
Venture                                                                   Venture

_________________________________      ________________________________

in presence of (witness)                                                   in presence of (witness)

Name ____________________________      Name ___________________________

Address___________________________     Address__________________________

_________________________________      ________________________________

Occupation________________________      Occupation _______________________

You may consider reading the following agreements

Isack Kimaro
Isack Kimaro

Editor-in-chief and founder of sherianajamii.com. Holder of Bachelor of Laws (LL.B) and Post Graduate Diploma in Legal Practice. Lawyer by profession and blogger by passion