Joint Venture Agreement
These are the agreements supposed to be made when two or more business entities intend to come together to fulfil their common objectives and mitigate the risk. And, this new union of strategic alliances can form a different identity to serve the purpose for which it is formed allowing such business entities to maintain their identities individually assists in maintaining clarity in regards to the dealings and proper transparent understanding of one another's roles & liabilities with various other aspects. It is essential to make this arrangement occur on paper via Agreement that will ultimately attract a binding force on each side.
The Joint Venture agreement creation is highly dependent on the nature of the business coming together and for the purpose, they are intending for the arrangement.
JOINT VENTURE AGREEMENT
THIS JOINT VENTURE AGREEMENT is made and entered and effective as of DATED: __________between __________and ____________________. And, the union of _________________ are hereinafter severally referred to as a “Joint Venturer” and collectively referred to as the “Joint Venturers.
NAME, ADDRESS OF THE PARTIES TO THIS CONTRACT ARE AS FOLLOWS;
Hereinafter referred to as “ Party A”,________which is a company duly organised and in existence in accordance with the law of India.
Legal Representative(s) Name & designation
Hereinafter referred to as “ Party B”,________which is a company duly organised and in existence in accordance with the law of India.
Legal Representative(s) Name & designation
Party A and Party B are hereinafter to as “Party” respectively and “Parties” collectively.
DEFINITION AND INTERPRETATION
The following words and expressions shall, unless the context otherwise require, have the following meaning;
Act – The (Companies Act of State of _________where the company is proposed to the incorporated as amended from time to time or any statutory re-enactment thereof, and wherever the context may require any statutory rules framing thereunder.
Agreement- This____agreement entered into between ________and the______.
Articles- the Articles of Association of the _____company to be incorporated pursuant to the Agreement
Document’ means any written, drawn, typed, printed, or photographic material, which relates to the Agreement.
Joint Venture’ means the joint venture formed by the Members in accordance with this Agreement hereto.
Board- the Board of Directors of the___Company (JVC-name).
Person-means any individual, corporation, partnership firm, limited liability company, joint venture, trust or any such association or any other entity or organisation and may include a Party hereto.
Shares- means the equity shares of the Company__________of Rupees which are issued time to time.
Shareholder(s)- means the holder of the Shares for the time being and “Shareholders” means collectively all those who hold the Shares.
Special Majority Resolution- in the case of a general meeting of the Company, and in the case of a meeting of the Board, a resolution on which all Directors present and representing each of the parties to this Agreement and being entitled to vote on such matter, will vote unanimously in favour of the resolution with respect to such Fundamental Issue.
Transfer – Whenever the sale, assignment, transfer, alienation of or the grant of any option or right to purchase a share or otherwise acquire Shares of the Company will happen in regards to the Shares and/ or the other Securities of the Company.
TRANSFER OF BUSINESS FROM ___Company to ____(this JVC_name_).
(This clause will speak about the whole of the business that is inclusive of all the assets, liabilities, rights, title, intellectual property or any interest in intellectual property which was carried out by the previous company and is subject to this new formation.)
CAPITAL STRUCTURE, SHAREHOLDHOLDING AND SUBSCRIPTION
Scope of the JCV
Subject to the Applicable Law, the activities of the JV will be, amongst others will include the following :
Incorporation of the Joint Venture company
The ___will incorporate JVC as __company under the Act for carrying on the Business. Upon the incorporation, the JVC will execute the relevant DEED if any_______, will be agreeing to be bound by the terms of this Agreement. (Also state information regarding the authorised share capital, and how much of the shares will be subject to division into equity shares. Along With the information, who will be initial subscribers/nominees for holding Equity Shares of JVC ).
Chairman- At the very first meeting of the Board of Directors, which is to be held with a number of days___after the allotment of shares to the Parties, the Chairman is to appointed by the parties who shall preside over all meetings of the Board and of the Shareholders at which he/she is present.
Voting- Subject to the provisions hereof, decisions of Board of Directors shall be by a majority vote of all the Directors It should be noted, that the Chairman shall not have a casting or second vote
Meetings of the Board-
Meetings of the Shareholders-
Powers and duties of the management-
Subscription clause- The Subscription to equity shares by the Parties herein will be as mutually decided and agreed to, where the Company shall allot the Shares as soon as it is possible but it should not be within ___days of time from the date of realisation of the subscription amount, and the entry of such Parties with their names and details will be made in its register of member as the holder of such Shares and deliver to each of the Parties, or as each of them may direct, the share certificate in respect thereof. The Company is expected to provide the Parties hereto with supportive evidence stating that it is in compliance with the laws and due process which is required for subscription,allotment, issuance of the shares.
The Parties hereto this Agreement shall not pledge, mortgage, hypothecate, charge or otherwise encumbrance or grant any security interests of any kind on any of the Shares nor do they involve
themselves in any such practices which shall result in any involuntary Transfer of Shares in favour of any Person including but not limited to any lenders of the Company. The Lock-in period is
of__________years to make any Transfer of Shares or its any part which is acquired by them pursuant to the provisions of this Agreement from the Closing Date____. And, the price this Shares shall be subject to acquired/sold/transferred by any Parties shall be at such price which is being mutually decided by them and agreed by the Transacting Person.
BOOKS OF ACCOUNTS, RECORDS AND AUDIT
The Joint Venture Company shall make sure that all its books of account, records are well maintained
as per the expected commercial practice and the figures are well accurately reflective of the financial
positions and in compliance with the requirements of the Act. The Parties shall be free to appoint
Chartered accountant at their own cost or as agreed amicably amongst them to carry independent audit or inspection of the financial position of this new formation____to make sure the smooth and
transparent dealings and working. The books and records of this Venture shall be reviewed annually
twice at the expense of the Venture by such appointed Accountants. There shall be one permanent
chartered accountant who shall (a) annually prepare and deliver to the Venture, for filing, the appropriate
income tax returns and all schedules to those returns, and (b) within _______number of days
following the end of each fiscal year of the Venture, deliver to Parties financial statements
of the Venture, including balance sheets, profit and loss statements, and statements showing allocations
and distributions to Parties.
ARTICLE OF ASSOCIATION
The Parties agree to be willing to do all such things and take all such precautions/actions to ensure that the provisions herein of this Agreement are brought in effect and the spirit of the agreement is intact.
Where there is a conflict, in respect to any provisions of the Agreement and the Articles, the provisions of this Agreement shall prevail between the Parties.
Either party shall keep confidential information (oral or written) concerning the business affairs of the Company or any of its affiliates that it shall have obtained or received as a result of the disclosure due to the discussions or otherwise leading upto or the entering into or implementation of this agreement or its association with the Company or any subsidiary of the Company. Either party undertakes to take all such steps from time to time as it shall be necessary to make sure the compliance of the Agreement with respect to its provisions and agree to maintain the secrecy of the trade secrets..
EFFECTIVE DATE, TERM AND TERMINATION
In the event where the either Party commits a breach of any of the provisions stated herein this Agreement, the Other Party shall without any prejudice to the other rights and remedies available, shall hold a right to terminate this Agreement with a prior delivery of notice of___days in writing stating the reasons of it and clearly stating the intention of termination attracting this clause of the Agreement.
Termination clause shall automatically come into effect where any of Parties is not in compliance with a clause of 5 & 8 of this Agreement and shall be subject to pay damages.
Other than aforementioned, the Agreement shall be subject to termination in the case where the Parties have mutually agreed in writing to terminate or in the eyes of law such event has happened or occurred which is justifiable for termination of this Agreement.
Any dispute, claim or controversy which may be arising out of or is relating to or in connection with this Agreement , or the breach, termination or validity hereof shall be subject to settlement by arbitration in respect to the Arbitration and Conciliation Act ,1996(includes the amendments) and the award passed in pursuance thereof shall be final and binding upon the Parties. The Seat of arbitration will be_________, India. The Language of proceedings of arbitration will be____. The Cost of Arbitration will be borne by the Parties amongst each other in equal proportions.
The failure to exercise any right provided in this Agreement shall not be a waiver of prior or subsequent rights.
The Parties herein this Agreement are not allowed to assign, transfer, or subcontract any of your rights and/or obligations under these Terms.
The provisions of this Agreement shall be deemed severable, and the unenforceability of any one or more of its provisions shall not affect the enforceability of any other provisions
The Agreement may be modified or amended time to time only by writing and when Parties agreed to do mutually
All the notices and communications required or permitted under this Agreement shall be in writing and any communication and delivery shall be deemed to have been duly made if actually delivered or after __ days after mailing, if mailed through registered post addressed.
This Agreement constitutes the entire agreement between the parties in connection with the subject-matter stated herein this Agreement. All other previous interaction/undertakings/documents are hereby superseded by this Agreement.
In Witness whereof the Parties hereto have duly executed this Agreement the day and year first written above.
PARTY 1 PARTY 2
Name & details Name & details
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