Fundamentals of joint venture agreement.pdf

∗ access to research, innovation, and productimprovements;∗∗providing marketing expertiese;providing management services.Separate agreements may be entered into between the respectiveparties and the JV company for some of the above obligations.(h)Agreement as to future issue of capitalThis clause sets out the ratios and terms upon which the partieswould subscribe to further issue of share capital and theconsideration that they would pay. This should also provide fora situation where one of the parties is unable to bring in morefunds due to a variety of reasons including a situation where theJV company is making losses requiring continuing financialstrain on the resources of the partners in order for the JV tobecome successful.(i)Appointment of directorsThis clause sets out the initial composition of the Board ofDirectors, representation on the Board of each of the parties, themanner in which the directors are appointed to the Board,whether the directors are liable for retirement by rotation, thecomposition of the Board in the event of change in the patternof shareholding, provisions for alternate directors, naming ofthe managing director and the Chairman, remuneration, etc. Itis not always necessary that the Managing Director isrepresentative of the majority partner. JVs are based on abalance of power rather than on the dominance by any onepartner. It also states whether the Chairman has a casting vote.(j)Conduct of the affairs of the JV CompanyThis clause includes the following:∗ Frequency of Board meetings