Joint Venture Agreement Term Sheet

(g) An additional impasse to the detriment of the minority shareholder could occur with regard to the distribution of profits. In this regard, a profit to be distributed in the form of a dividend should be agreed in the shareholder contract (for example.B. as a minimum percentage of the year`s result or according to the amount of Indian income). (h) In the event of a share transfer, the weakest partner should insist on a minimum period during which the transfer of shares is not allowed (blocking time). Only then will he be able to obtain a guaranteed return on his investment. Thereafter, there could be a well-defined circle of “approved takers” with the right of pre-emption (or a right of pre-emption) of the non-ceding partner. If the investment turned out to be negative for the minority partner, it would be well protected if it were granted a put option (at a price corresponding to an established valuation method). If it sells only a portion of its shares, it is important for the minority partner to retain its minority rights (at least to a reasonable extent). (i) The provisions relating to the exit of the joint venture are of the utmost importance to the minority partner: the duration of the joint venture, either for a fixed period or for an indeterminate period, will depend to a large extent on the nature of the project. However, it will be even more important for the minority partner to have the right to leave the country in cases of events, and it is no longer acceptable for the minority partner to continue. (Such an event may be the change of control through the majority partner).) There are different exit options: the company can be a group of companies (for example.

B Dow Corning), a project/JV that pursues only a specific project or a group of companies that aims to set standards or serve as an “industrial utility” that provides a limited number of services to industry players. b) The same applies to employment contracts with key staff (including pension contracts with senior managers). There is, however, one thing that cannot be included in a contractual clause: bridging the “cultural gap” between the partners of the joint venture, so that the joint venture is a lasting success, both for the weak and for the strong partner. (a) in particular, the minority partner should insist that the objective of the joint venture be properly defined; This will help when the interpretation of joint enterprise agreements is at stake.