California joint venture agreement template

California Joint Venture Agreement

This CALIFORNIA JOINT VENTURE AGREEMENT (the “Agreement”) is made and effective as of this [Date] day of [Month], [Year], by and between:

• [Full Legal Name of Party 1], a [Legal Status of Party 1, e.g., California corporation], with its principal place of business at [Full Address of Party 1] (“[Designated Short Name of Party 1]”);

and

• [Full Legal Name of Party 2], a [Legal Status of Party 2, e.g., California limited liability company], with its principal place of business at [Full Address of Party 2] (“[Designated Short Name of Party 2]”).

(Each a “Party” and collectively, the “Parties”).

WHEREAS, the Parties desire to form a joint venture for the purpose of [Brief Description of the Joint Venture Purpose] in the State of California;

NOW, THEREFORE, in consideration of the mutual covenants contained herein, the Parties agree as follows:

Formation and Type of Joint Venture

• Option A: General Partnership. This Agreement shall constitute a general partnership governed by the California Revised Uniform Partnership Act (California Corporations Code Section 16100 et seq.).
• Option B: Limited Partnership. This Agreement shall constitute a limited partnership governed by the California Revised Limited Partnership Act (California Corporations Code Section 15900 et seq.). [Designated Short Name of Party 1] shall be the General Partner and [Designated Short Name of Party 2] shall be the Limited Partner.

Parties

• [Designated Short Name of Party 1]: [Legal Status of Party 1], duly organized and validly existing under the laws of [State of Incorporation/Formation of Party 1], and authorized to do business in the State of California.
  • Option A: [Designated Short Name of Party 1] is a General Partner.
  • Option B: [Designated Short Name of Party 1] is a Limited Partner.
• [Designated Short Name of Party 2]: [Legal Status of Party 2], duly organized and validly existing under the laws of [State of Incorporation/Formation of Party 2], and authorized to do business in the State of California.
  • Option A: [Designated Short Name of Party 2] is a General Partner.
  • Option B: [Designated Short Name of Party 2] is a Limited Partner.
• Appointment of Managing Partner/Representative:
  • Option A: [Full Legal Name of Managing Partner/Representative] is hereby appointed as the Managing Partner/Representative of the Joint Venture.
  • Option B: The Parties shall jointly manage the Joint Venture.

Principal Place of Business and Registered Agent

• The principal place of business of the Joint Venture shall be located at [Full Address of Principal Place of Business in California].
• Registered Agent (if applicable):
  • Option A: The registered agent for service of process in California shall be [Full Legal Name of Registered Agent] with an address at [Full Address of Registered Agent in California].
  • Option B: No registered agent is required.

Purpose and Scope

• The purpose of the Joint Venture is to [Detailed Description of Joint Venture Business Purpose], including but not limited to: [List of Specific Activities].
• Scope of Allowed Activities: The Joint Venture is authorized to engage in activities reasonably necessary to achieve its stated purpose.
• Limitations: The Joint Venture shall not engage in [List of Prohibited Activities].

Term and Termination

• The term of this Agreement shall commence on [Start Date] and shall continue for a period of [Number] years, unless earlier terminated as provided herein.
• Expiration: This Agreement shall expire automatically on [Expiration Date], unless renewed by mutual written consent of the Parties.
• Renewal/Extension:
  • Option A: This Agreement may be renewed for additional terms of [Number] years upon the written agreement of both Parties, executed no later than [Number] days prior to the expiration date.
• Early Termination:
  • Option A: This Agreement may be terminated by either Party upon [Number] days written notice to the other Party.
  • Option B: This Agreement may be terminated upon the occurrence of the following events: [List of Triggering Events].

Capital Contributions

• [Designated Short Name of Party 1] shall contribute the following: [Description of Party 1's Contribution, e.g., Cash, Property, Services] with a value of [Dollar Amount].
• [Designated Short Name of Party 2] shall contribute the following: [Description of Party 2's Contribution, e.g., Cash, Property, Services] with a value of [Dollar Amount].
• Valuation Process: The value of non-cash contributions shall be determined by [Description of Valuation Method].
• Further Contributions:
  • Option A: No further capital contributions shall be required.
  • Option B: Further capital contributions may be required as determined by [Method of Determining Further Contributions]. Failure to contribute shall result in [Consequences of Failure to Contribute].

Ownership Interests

• [Designated Short Name of Party 1] shall have a [Percentage]% ownership interest in the Joint Venture.
• [Designated Short Name of Party 2] shall have a [Percentage]% ownership interest in the Joint Venture.
• Adjustment of Percentages:
  • Option A: Ownership percentages shall remain fixed.
  • Option B: Ownership percentages may be adjusted based on [Criteria for Adjusting Ownership Percentages, e.g., Additional Contributions, Dilution Events].

Profits and Losses

• Profits and losses shall be allocated between the Parties in proportion to their respective ownership interests.
• Distribution Timing: Profits shall be distributed to the Parties [Frequency of Distribution, e.g., Annually, Quarterly].
• Special Allocations:
  • Option A: There shall be no special allocations.
  • Option B: [Description of Special Allocations, e.g., Guaranteed Payments, Priority Returns].
• Tax Matters:
  • [Designated Party] shall be responsible for preparing and filing all required tax returns, including IRS Schedule K-1s, California Form 565 or 568, and all requisite state and local tax documents.

Tax Classification

• The Joint Venture shall be classified as a [Tax Classification, e.g., Partnership] for federal and California tax purposes.
• Partnership Representative: [Full Legal Name of Partnership Representative] is hereby appointed as the Partnership Representative/Tax Matters Partner, with the authority and limitations as defined by applicable California and federal law.

Management

• Day-to-Day Management:
  • Option A: A management committee consisting of [Number] representatives from each Party shall manage the Joint Venture.
  • Option B: [Full Legal Name of Managing Partner/Representative] shall have full authority to manage the day-to-day operations of the Joint Venture.
• Major Actions: The following actions shall require the approval of [Required Approval Threshold, e.g., Majority, Supermajority] of the Parties: [List of Major Actions Requiring Approval, e.g., Capital Calls, Mergers, Sale of Assets].

Duties and Fiduciary Responsibilities

• Each Party shall owe a duty of care and loyalty to the Joint Venture and to the other Party, consistent with California law.
• Restrictions on Competition:
  • Option A: The Parties shall not compete with the Joint Venture during the term of this Agreement.
  • Option B: [Specific Restrictions on Competition].
• Conflict of Interest: Each Party shall disclose any potential conflicts of interest to the other Party.

Operations Plan

• Banking Arrangements: The Joint Venture shall maintain its bank accounts at [Name of Bank].
• Recordkeeping: The Joint Venture shall maintain accurate and complete books and records, in accordance with generally accepted accounting principles and California law regarding access and retention of records.
• Insurance: The Joint Venture shall maintain the following insurance coverage: [List of Required Insurance Coverage, e.g., General Liability, Workers' Compensation].

Personnel, Intellectual Property, and Confidentiality

• Employment of Personnel: The Joint Venture shall be responsible for hiring and managing its own employees.
• Intellectual Property: All intellectual property developed by the Joint Venture shall be owned by [Ownership of Intellectual Property, e.g., Jointly, the Joint Venture].
• Confidentiality: Each Party shall maintain the confidentiality of all confidential information of the Joint Venture and the other Party, in accordance with California trade secret and privacy laws.

Admission of New Partners

• No new partners may be admitted to the Joint Venture without the written consent of all existing Parties.
• Required Approvals: Admission of a new partner shall require [Specific Approvals Required].

Transfer of Interests

• No Party may transfer or assign its interest in the Joint Venture without the prior written consent of the other Party.
• Right of First Refusal: The non-transferring Party shall have a right of first refusal to purchase the transferring Party's interest.
• Valuation of Transferred Interests: The value of any transferred interest shall be determined by [Method of Valuation].

Withdrawal, Expulsion, Death, or Dissolution of a Partner

• Withdrawal: A Party may withdraw from the Joint Venture upon [Number] days written notice to the other Party, subject to the following conditions: [Conditions of Withdrawal].
• Expulsion: A Party may be expelled from the Joint Venture for [Grounds for Expulsion].
• Effect of Death, Disability, or Bankruptcy: [Procedures for Death, Disability, or Bankruptcy of a Party].

Liability

• General Partners shall have unlimited joint and several liability for the debts and obligations of the Joint Venture, as provided under California law, unless otherwise structured as a limited partnership.
• Indemnification: Each Party shall indemnify and hold harmless the other Party from and against any and all claims, losses, damages, liabilities, costs, and expenses arising out of or relating to [Scope of Indemnification].

Books and Records

• The Joint Venture shall maintain complete and accurate books and records at its principal place of business.
• Each Party shall have the right to inspect and copy the books and records of the Joint Venture upon reasonable notice.

Governing Law and Dispute Resolution

• This Agreement shall be governed by and construed in accordance with the laws of the State of California.
• Any dispute arising out of or relating to this Agreement shall be resolved by:
  • Option A: Negotiation.
  • Option B: Mediation in [City, California].
  • Option C: Arbitration in [City, California] in accordance with the rules of [Arbitration Organization, e.g., JAMS, AAA].

Compliance with Laws

• The Joint Venture shall comply with all applicable California business licenses, permits, environmental, industry-specific, and employment regulations.
• [Designated Party] shall be responsible for all required regulatory filings, including Secretary of State Statements of Information.

Amendment and Waiver

• This Agreement may be amended only by a written instrument signed by all Parties.
• No waiver of any provision of this Agreement shall be effective unless in writing and signed by the Party against whom the waiver is sought to be enforced.

Dissolution and Winding Up

• This Joint Venture may be dissolved upon the occurrence of any of the following events: [List of Dissolution Events].
• Upon dissolution, the assets of the Joint Venture shall be liquidated, and the proceeds shall be distributed in the following order: [Order of Distribution].

Representations and Warranties

• Each Party represents and warrants that it has the full power and authority to enter into this Agreement and to perform its obligations hereunder.
• Each Party represents and warrants that its contribution to the Joint Venture does not infringe upon the rights of any third party.

Force Majeure

• Neither Party shall be liable for any failure to perform its obligations under this Agreement if such failure is caused by a force majeure event, including but not limited to acts of God, war, earthquake, wildfire, or other natural disaster.

Notices

• All notices required or permitted under this Agreement shall be in writing and shall be deemed to have been duly given when delivered personally, sent by certified mail, return receipt requested, or sent by reputable overnight courier service, to the addresses set forth above.

Entire Agreement

• This Agreement constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior or contemporaneous communications and proposals, whether oral or written.

California Tax Matters

• The Parties shall comply with all applicable California tax laws, including but not limited to gross receipts tax, apportionment rules, and property tax reassessment rules.
• [Designated Party] shall be responsible for compliance with Franchise Tax Board requirements for nonresident withholding.

Insurance Requirements

• The Joint Venture shall maintain insurance coverage typical to the business (workers’ compensation, general liability, D&O if appropriate), as required or customary in California.

Industry-Specific Regulations

• The Parties shall comply with all applicable California laws and regulations specific to [Industry of the Joint Venture, e.g., real estate, cannabis, healthcare].

Consumer Protection and Environmental Clauses

• The Parties shall comply with all mandatory consumer protection or environmental clauses demanded by California public policy for the Joint Venture’s sector.

California Antitrust, Unfair Competition, Discrimination, Employment, and Privacy Laws

• The Parties shall comply with all applicable California antitrust, unfair competition, discrimination, employment, and privacy laws (CCPA/CPRA), where relevant.

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first written above.

[Full Legal Name of Party 1]

By: [Signature of Authorized Representative of Party 1]

Name: [Printed Name of Authorized Representative of Party 1]

Title: [Title of Authorized Representative of Party 1]

[Full Legal Name of Party 2]

By: [Signature of Authorized Representative of Party 2]

Name: [Printed Name of Authorized Representative of Party 2]

Title: [Title of Authorized Representative of Party 2]