Joint VenturesWe provide clear, practical advice to anyone setting up a new company, business, joint venture or partnership.
Whilst Joint Venture agreements for small business need careful consideration, legal advice needs to reflect budgets, practicalities and risks and at TWS Legal Consultants we understand this and the commercial realities.
When most people think of a Joint Venture Agreement they tend to think about big multinationals on huge projects but joint ventures of all kinds are becoming an increasingly important way of doing business for small business also.
It is essential to agree in advance who will run and control the business, what decisions will require consent from other parties and what will happen if one party wants to exit.
We can help draw up an agreement to regulate your business relationship and advise on how to structure your business, both to succeed commercially and be tax efficient, as well as what documents you will need.
Risks, rewards, structure, pitfalls, control and exit strategy are important with any business joint venture.
Important clauses in a Joint Venture Agreement
To minimise the possibility of misunderstandings or disputes, a Joint Venture Agreement should incorporate the following essential clauses:-
- structure of the joint venture -the structure of the business whether limited company, partnership or other legal form.
- profits and losses – agreement on division of profit & loss and tax.
- events of default, termination, exit and dispute resolution procedures.
- practicalities and day to day control – issues such as bank mandates, operational restrictions.
- ownership of assets in the joint venture including intellectual property.
- financial commitments at outset and in future -how will the joint venture company be funded initially? Will the investors be obliged to provide future funding?
- borrowing – will the new business need to borrow from external sources? If so, who will agree to provide any necessary guarantee for the borrowing?
- budgets and business plans – who will prepare and when?
- dividends – what is the agreed policy, will they be payable and if so, on what basis?
- senior management – who will have the right to appoint senior management? If the joint venture is based on a 50/50 investment and ownership, what happens if there is deadlock?
- exit and grounds for termination – exit strategy is key and may include policy on sale of the business, material breach, insolvency, change of control, sale of shares to third parties, drag along or tag along rights.
If you need practical, experienced and cost effective solicitors for advice on joint ventures or to draft, negotiate or advise on a joint venture contract, please get in touch.
We appreciate that your priority is running your business and not managing a complex partnership document. We will provide you with a clear document in plain language, and make sure you are not bogged down with unnecessary paperwork.
Please contact one of our experienced lawyers for more details. Email us at firstname.lastname@example.org or call +971 4 448 4284.