Joint Venture Agreement
(General Partnership)

Summary

This joint venture agreement may be used for a venture in the form of a general partnership. This joint venture agreement includes restrictions on transfer, including a right of first refusal and buy-sell provision. This template includes practical guidance, drafting notes, and optional clauses. A joint venture agreement setting forth the rights and obligations and the mechanics of how a new venture will operate must be negotiated and drafted for all forms of joint ventures. The co-venturers may choose to form a separate entity for the joint venture, which may be a partnership, corporation, or limited liability company (LLC). As noted above, this joint venture agreement is appropriate for a general partnership joint venture. For an annotated template joint venture agreement for an LLC, see Limited Liability Company Agreement (Joint Venture, DE). The parties to a joint venture should consider addressing each of the following items in a joint venture agreement, as appropriate: • Parties, scope, and purpose. A description of the parties bound by the joint venture agreement and the joint venture's scope and purpose. • Management. Provisions for the day-to-day management of the venture and decision-making processes for major actions. • Capital structure/ownership. A description of the ownership classes of the joint venture and their respective management and control rights, including their shares of profits and losses. • Business plan and budget. Provisions for the creation, delivery, and approval of a business plan, and budget outlining projected contributions and expenditures. • Capital contributions and non-cash contributions. Provisions governing how and when initial and future capital contributions will be made, and how noncash contributions will be valued. • Distributions/dividends. Provisions governing how and when distributions, dividends, or other payments to the venturers will be made. • Restricting transfers of interests. Provisions setting forth restrictions on how and when venturers may sell their interests and exit the joint venture. • Termination and exit. Termination, liquidation, sale, and buyout provisions. • Conflicts and corporate opportunity; non-compete provisions. Provisions dealing with potential conflicts between the venturers' existing businesses and the business of the joint venture, including restrictions on competition and corporate opportunities that may be pursued outside the venture. • Interested party transactions. Provisions dealing with potential interested party transactions between a joint venture partner and the joint venture. • Confidentiality. Provisions protecting the proprietary information of the joint venture. • Indemnification and liability. Provisions for the indemnification of the joint venture and its members. • Dispute resolution and deadlock. Resolution and deadlock provisions for disputes among the venturers. • Amendments. Provisions for the approval of amendments to the joint venture agreement. Counsel should consult applicable state partnership laws when drafting this agreement. For example, depending on local law, a filing with the Secretary of State may be required to form a partnership, which may implicate a filing under the Corporate Transparency Act (for an example provision to include, see Corporate Transparency Act Clause (Joint Venture Agreement)). For further information on joint ventures, see Joint Venture Resource Kit, Joint Venture Structuring and Planning — Basic Forms of Joint Ventures, Related Party Transactions in Joint Ventures, and Key Provisions in Joint Venture Agreements — Parties, Scope, Purpose.