Joint Venture Agreement (Template)

AGREEMENT

AGREEMENT is made this ____day of ___________, 20xx, by and between Company A and Company B.

RECITALS

• A. The parties desire to submit a proposal by and in the name of the ____________ Joint Venture to the ____________ (the "Customer") in response to Solicitation No. _______________.
• B. The Proposal will state that any contract awarded implementing the proposal (or modifications)pursuant of the RFP will be performed by Company A and Company B as the ____________ Joint Venture.

FORMATION

Company A and Company B hereby constitute themselves as ___________ Joint Venture for the purpose of submitting Proposal _______________ under the identified Solicitation No. above, and if won, performing the Prime Contract. The formation of the JV is not for any other purpose. It is expressely understood the Venturers are not making any permanent partnership of any other agreement for any other purpose than the purpose stated above. Neither Venturer shall have any power to bind the other Venturer except as expressly set for in this Agreement. Nothing in this Agreement shall be construed as a limitation of the powers or rights on either Venturer to carry on its separate business for its sole benefit. During the term of this Agreement, each Venturer shall work exclusively with the JV in implementing the purpose set forth herein, and shall not compete directly or indirectly with the JV.

Confidential Information

restrictions on disclosure or use of confidential information

Governing Law

== Breaches and Material Defaults possible remedies for a material default include: - loss of management board representation - dilution - imposition of mandatory call - discounted puts, calls and buy-sell valuation amounts - termination of licenses and other intercorporate arrangements • consider whether non-material breaches when aggregated or continuing should constitute a material breach and whether and which types of breaches should benefit from a cure period

Exit and Termination Rights

Agreement will generally make provision for the termination of the JV and/or the exit of one partner from the JV. If JV is for the purpose of establishing and operating a particular business, consider whether in fact there should be any exit or termination provisions. Even if it is acknowledged that the JV may not succeed, the circumstances of the failure will be impossible to predict at outset and the parties may wish to take the position that reasonable co-venturers will be able to negotiate a satisfactory termination at the time. However if one co-venturer is clearly stronger than other, then the weaker co-venturer will undoubtedly prefer to have exit rights clearly delineated in the agreement. 34. Determination of Triggering Events and Exit and Termination Provisions • consider what appropriate triggering events are. Usually two categories— default and non-default. Exit or termination rights will be different depending on whether default or non-default. • examples of default events would include those material breaches set out above—i.e., a default by one of the co-venturers in the observance of its obligations under the agreement or by the occurrence of specified events that have the same consequences, such as a change of control of a co-venturer • no-default events may include such matters as: - events that reflect a frustration of the business intent such as the failure to achieve certain business/sales/operational targets, etc. management deadlocks - third party offers for the interests of one or both of the co-venturers - 15 - Error! Unknown document property name. - a change in business strategy or personnel of one of the co-venturers that has the effect of that co-venturer wanting to liquidate its interest in the JV • in the case of both a non-default event and a default by one of the co-venturers, the usual remedies are dissolution of the JV or a buy-out of the defaulting co-venturer’s interest by the non-defaulting co-venturer. The negotiation of the remedies in each of these situations will result in a determination of who may chose the applicable remedy and the way in which that remedy is accomplished in both default and no-default situations. • consider whether there should be a period of time at the outset of the venture during which no transfers or exit rights (except on default) are permitted