Negotiate a Joint Venture Agreement
- 36 mins on-demand video
- 29 downloadable resources
- Full lifetime access
- Access on mobile and TV
- Certificate of Completion
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- Students taking this course will learn why large companies are interested in entering a joint venture company agreement with young start-ups. Large companies can introduce new products in the world markets without the need to spend time in in-house research and development.
- Free sample joint venture agreement texts are available in internet. Reviewing a few sample texts the students learn the flavor of the terminology. In real life cases we would need the help of the company legal counsel.
This course consists of three sections. The first section covers a discussion of joint ventures reported in the media, the length of life of some known joint venture companies as well as the opportunities and risks faced by the parties to a joint venture Company.
The second section lists the issues which the startup Company managers will face in the negotiations.
The third section discusses a list of clauses from a joint venture agreement. To draft a complete agreement the startup Company managers will need the assistance of a professional legal counsel.
- This course is targeted to students who already are working in companies which are engaged in international business or plan to enter in the service of internationally oriented companies after finishing their studies.
We will discuss the formation of a hypothetical joint venture Company between two existing companies, Nordic Health Instruments (NHI) and Southeastern Medicre Products, Inc. (SMI).
NHI is a small young Company registered and domiciled in Helsinki, Finland. Its two principal shareholders are Mr. Peter Nord, a medical doctor, and Mr. John West, an engineer whose specialties aere information technology and product design. They have developed a prototype of a medical device which has been test marketed to a local operator in the medical device market. They have also started the development work on another product.
SMI is one of the global leaders in its field. The Company designs, manufactures and markets medical devices. Several of its products hold a leading market share in the US markets and have a strong position in South American, Australian and leading Asian markets. SMI has a strong in-house R&D organization. The Company has been ready to acquire smaller companies with advanced products.
The Structure and Objectives of the New Entity
- The Structure of the New Entity
- The intention of both parties is that the new entity will be legally separate Company,
- The Company will be based on a 50% - 50% ownership,
- The parent Company SMI will own 50 % of the capital stock of the new Company,
- Respectively, Nordic Health Instruments Ltd (NHI) will own 50 % of the capital stock of the new Company.
The Objective of the New Entity
The objective of the new joint venture company is to accelerate the sales growth of both parties by introducing new products which are the result of the R&D work performed by the JVC personnel.
A Party (the Large Company) to the Joint Venture Company Agreement sells to an outside party the shares which it owns in the Joint Venture Company (i.e., 50 % of the capital stock of the JV Company). Can the other Party (the Startup Company) terminate the Joint Venture Company Agreement?
A Party (the Large Company) to the Joint Venture Company Agreement sells to an outside party its Business Unit which is in charge of the distribution and marketing of the products of the Joint Venture Company. Can the other Party (the Startup Company) terminate the Joint Venture Company Agreement?
A Party (the Large Company) to the Joint Venture Company Agreement is in the process of establishing a new manufacturing company in China. As required by the Joint Venture Company law in China, the new company will be a joint venture with a Chinese company. Can the
other Party (the Startup Company) terminate the Joint Venture Company Agreement which has been signed and is operating between the Startup company and the Large Company in Finland?