South Dakota joint venture agreement template

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How South Dakota joint venture agreement Differ from Other States

South Dakota law does not require joint venture agreements to be filed with the state, unlike in some other states with registration mandates.
South Dakota enforces its own version of the Uniform Partnership Act, which may alter default management and liability provisions compared to other states.
State-specific tax treatment and reporting obligations for joint ventures may differ in South Dakota due to its lack of state income tax.

Frequently Asked Questions (FAQ)

Q: Is a joint venture agreement legally binding in South Dakota?

A: Yes, a properly executed joint venture agreement is legally binding and enforceable under South Dakota law.
Q: Does a South Dakota joint venture need a separate business entity?

A: No, but parties may form a separate entity for liability or tax reasons. Otherwise, an agreement alone can establish the venture.
Q: Are joint venture profits subject to South Dakota state income tax?

A: No, South Dakota does not impose a state income tax, but federal tax obligations still apply to joint venture income.

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South Dakota Joint Venture Agreement

This South Dakota Joint Venture Agreement ("Agreement") is made and entered into as of [Date], by and between:

[Venturer 1 Full Legal Name], a [State of Formation] [Entity Type] with its principal place of business at [Venturer 1 Address] ("Venturer 1"); and
[Venturer 2 Full Legal Name], a [State of Formation] [Entity Type] with its principal place of business at [Venturer 2 Address] ("Venturer 2").

Recitals omitted for brevity.

1. Formation and Name

Option A: Formation. The parties hereby form a joint venture (the "Joint Venture") under the laws of the State of South Dakota pursuant to [SDCL Title 48-1A or Title 48-1C, specify].
Option B: Name. The name of the Joint Venture shall be [Joint Venture Name].

2. Purpose and Scope

Option A: Purpose. The purpose of the Joint Venture is to [Detailed Description of Business Purpose].
Option B: Scope. The scope of the Joint Venture's activities shall include, but not be limited to: [Specific Activities List, including SIC or NAICS codes if relevant].
Option C: Principal Place of Business. The principal place of business of the Joint Venture shall be located at [Address in South Dakota].

3. Capital Contributions

Option A: Initial Contributions. Venturer 1 shall contribute [Venturer 1 Initial Contribution Description], and Venturer 2 shall contribute [Venturer 2 Initial Contribution Description].
Option B: Valuation. The value of non-cash contributions shall be determined by [Valuation Methodology].
Option C: Future Funding. Future capital contributions shall be required as determined by [Decision-Making Authority] and shall be allocated between the Venturers in proportion to their Ownership Percentages as outlined in Section 4.

4. Ownership and Control

Option A: Ownership Percentages. Venturer 1 shall own [Percentage]% of the Joint Venture, and Venturer 2 shall own [Percentage]% of the Joint Venture.
Option B: Voting Rights. Voting rights shall be allocated in proportion to the Ownership Percentages.

5. Management

Option A: Management Structure. The Joint Venture shall be managed by [Executive Committee, Managing Partner, or Outside Manager Name].
Option B: Authority. The [Executive Committee, Managing Partner, or Outside Manager Name] shall have the authority to [Scope of Authority] subject to the limitations set forth herein and consistent with SDCL.
Option C: Business Approval Thresholds. Major business decisions requiring approval include: [List of Major Decisions], which require approval of [Percentage]% of the [Executive Committee, Managing Partner].
Option D: Reserve Matters. The following matters shall require unanimous consent of both venturers: [List of Reserve Matters].

6. Meetings and Notices

Option A: Regular Meetings. Regular meetings of the [Executive Committee/Partners] shall be held [Frequency, e.g., monthly, quarterly] at [Location/Method].
Option B: Notice Provisions. Notice of meetings shall be given at least [Number] days prior to the meeting date.
Option C: Quorum. A quorum for any meeting shall consist of [Number/Percentage]% of the [Executive Committee/Partners].

7. Profit and Loss Allocation

Option A: Allocation. Profits and losses shall be allocated between the Venturers in proportion to their Ownership Percentages.
Option B: Distributions. Distributions of distributable cash shall be made [Frequency, e.g., quarterly, annually] to the Venturers in proportion to their Ownership Percentages.
Option C: Distributable Cash Definition. Distributable cash shall be defined as [Definition of Distributable Cash].

8. Tax Matters

Option A: Tax Treatment. The Joint Venture shall be treated as a partnership for federal and South Dakota income tax purposes.
Option B: Tax Matters Partner. [Name] is hereby designated as the Tax Matters Partner (or Partnership Representative) for the Joint Venture.
Option C: K-1s. Schedule K-1s will be distributed to the Venturers by [Date] each year.

9. Intellectual Property

Option A: Ownership. All intellectual property created by the Joint Venture shall be owned by [Joint Venture/Venturer 1/Venturer 2].
Option B: Licensing. Venturer 1 grants the Joint Venture a license to use the following intellectual property: [Description of IP]. The terms of the license are [License Terms].

10. Insurance and Indemnification

Option A: Insurance. The Joint Venture shall maintain the following insurance coverage: [List of Required Insurance Policies].
Option B: Indemnification. Each Venturer shall indemnify the other against losses arising from [Scope of Indemnification], subject to limitations under South Dakota law.

11. Bank Accounts and Accounting

Option A: Bank Accounts. The Joint Venture shall maintain bank accounts at [Bank Name].
Option B: Accounting Method. The Joint Venture shall use the [Accrual/Cash] method of accounting.
Option C: Fiscal Year. The fiscal year of the Joint Venture shall end on [Date].

12. Contributions of Personnel and Resources

Option A: Venturer 1 shall contribute the following personnel: [Personnel Description].
Option B: Venturer 2 shall contribute the following resources: [Resources Description].
Option C: Reimbursement or compensation for such contributions will be as follows: [Compensation details].

13. Admission of New Venturers

Option A: Admission Criteria. New Venturers may be admitted with the consent of [Percentage]% of the existing Venturers.
Option B: Capital Requirements. New Venturers shall be required to contribute [Capital Contribution Amount/Formula].

14. Transfer of Interests

Option A: Restrictions on Transfer. No Venturer may transfer its interest in the Joint Venture without the prior written consent of the other Venturer(s).
Option B: Right of First Refusal. If a Venturer desires to transfer its interest, the other Venturer(s) shall have a right of first refusal to purchase such interest.
Option C: Conditions for Withdrawal or Expulsion of partners: [Conditions]

15. Default and Remedies

Option A: Events of Default. The following shall constitute events of default: [List of Events of Default].
Option B: Remedies. Upon an event of default, the non-defaulting Venturer(s) shall have the following remedies: [List of Remedies].
Option C: Valuation. Valuation of interest upon withdrawal, expulsion, death, or disability: [Valuation method].

16. Dispute Resolution

Option A: Mediation. Any dispute arising under this Agreement shall be submitted to mediation in [City, South Dakota].
Option B: Arbitration. If mediation is unsuccessful, the dispute shall be resolved by binding arbitration in [City, South Dakota] in accordance with the rules of the American Arbitration Association.
Option C: Governing Law and Jurisdiction. This Agreement shall be governed by and construed in accordance with the laws of the State of South Dakota. Jurisdiction and venue shall be in [County], South Dakota.

17. Non-Competition and Confidentiality

Option A: Non-Competition. Each Venturer agrees not to compete with the Joint Venture during the term of this Agreement and for a period of [Number] years thereafter within [Geographic Area].
Option B: Confidentiality. Each Venturer agrees to maintain the confidentiality of the Joint Venture's confidential information.

18. Dissolution

Option A: Events of Dissolution. The Joint Venture shall dissolve upon the occurrence of any of the following events: [List of Events of Dissolution].
Option B: Winding Up. Upon dissolution, the assets of the Joint Venture shall be liquidated and distributed in accordance with South Dakota law.
Option C: Dissolution Filings. Upon dissolution, Articles of Dissolution or similar notice will be filed with the South Dakota Secretary of State.

19. Representations and Warranties

Option A: Each Venturer represents and warrants that it has the power and authority to enter into this Agreement.
Option B: Each Venturer represents and warrants compliance with all applicable South Dakota statutes and regulations.

20. Environmental, Employee, and Labor Compliance

Option A: Environmental Compliance: The Joint Venture will comply with all applicable environmental laws and regulations in South Dakota.
Option B: Employee and Labor Compliance: The Joint Venture will comply with all applicable employee and labor laws and regulations in South Dakota and federal law.

21. Amendment and Waiver

Option A: Amendment. This Agreement may be amended only by a written instrument signed by all of the Venturers.
Option B: Waiver. 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.

22. Term

Option A: Term. The term of this Agreement shall commence on the Effective Date and shall continue for a period of [Number] years.
Option B: Voluntary Termination. This agreement may be voluntarily terminated with [Number] days written notice by [Percentage]% of partners.

23. Record Keeping and Inspection

The Joint Venture shall maintain all required records (including meeting minutes and financial statements) at its principal place of business in South Dakota. Each Venturer shall have the right to inspect such records upon reasonable notice.

24. South Dakota Regulatory Compliance

Option A: Agricultural Joint Ventures: This joint venture will comply with all relevant South Dakota laws and regulations pertaining to agricultural joint ventures.
Option B: Energy Joint Ventures: This joint venture will comply with all relevant South Dakota laws and regulations pertaining to energy joint ventures.
Option C: Healthcare Consortia: This joint venture will comply with all relevant South Dakota laws and regulations pertaining to healthcare consortia.

25. State-Specific Filings

Option A: The Joint Venture shall file all necessary documents with the South Dakota Secretary of State.

26. Governing Law

This Agreement shall be governed by and construed in accordance with the laws of the State of South Dakota, including SDCL Title 48-1A or 48-1C as applicable. IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above. [Venturer 1 Full Legal Name] By: [Name and Title] [Venturer 2 Full Legal Name] By: [Name and Title]