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MODEL JOINT VENTURE AGREEMENT
C H E C K L I S T
INTRODUCTION
• Joint ventures (“JV”) may take a number of forms, but the basis on which they
are formed is always a commercial collaboration in which two or more
unrelated parties pool, exchange, or integrate some of their resources with a
view to mutual gain, while at the same time remaining independent. This
checklist provides a basis on which to consider the issues surrounding the
formation of the JV and the ongoing legal rights and obligations between the
parties.
• Much of this checklist relates to a limited liability company form of JV but
many of the issues raised will be equally relevant to the corporate form. In
addition, there are tax and regulatory issues that will impact the structure and
operation of the JV and they are not addressed in any great detail here.
• As this is a generic checklist it does not take into account any specific national
or state requirements. To the extent that the JV is international, local law may
mandate additional considerations, as will industry specific issues particularly
in the context of regulatory concerns.
• Note also: this checklist generally contemplates a two-party JV. Multi-party
JV’s are more complex, particularly with regard to corporate governance
supermajority requirements, dilution and exit rights.
PLANNING
1. Scope/Purpose of the Joint Venture (“JV”)
• Identify scope/purpose of the JV—consider implications of such scope in
connection with:
- what activities does the JV expressly intend to do or refrain from doing
- corporate opportunity issues (i.e., what are the existing and potential
future conflicts with each party’s non-JV businesses)
- this will lead to a conclusion on the scope of the non-compete
covenants and the confidentiality obligations of each party
- is there any core technology or other intellectual property (“IP”) either
to be transferred to the JV or to be granted by the parties to the JV
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