Agreements (Collaboration)

 

• A collaboration agreement (also known as a joint venture agreement or strategic alliance agreement) is a type of agreement covering a group of independent individuals or legal entities, or some combination thereof, who join together for a particular project, and in which the role of each such individual or legal entity is clearly defined.

 

• A collaboration agreement does not create a partnership legal entity, since a collaboration agreement is generally used only for one specific project, whereas a partnership is intended to continue indefinitely, until terminated by the partners.

 

• There are generally two types of collaboration agreements: contractual (in which the collaboration agreement itself creates and defines the collaborative arrangement between the collaborating parties); and, entity-based (in which the collaboration agreement includes the framework allowing the collaborating parties to form a new and independent legal entity – such as a corporation or limited liability company (LLC) – through which the project will be administered; more generally used when the collaboration agreement is modeled more as a joint venture between the collaborating parties).

 

• At a minimum, the collaboration agreement should clearly delineate: the names of each individual or legal entity which is part of the collaboration; the specific duties of each; the specific funds or other consideration (such as materials or work) to be contributed from each, and on what schedule; the specific duties of each; the specific ownership interest of each; the specific profit percentage granted to each; the decision-making hierarchy for the project; the milestone schedule for the project; any method to allow modification of the collaboration agreement; how an original collaborator may leave the project; how a new collaborator may be added to the project; the intellectual (IP) property rights of each collaborator; confidentiality; data privacy; data security; dispute resolution; indemnification; insurance; limitation of liability; non-disclosure; non-compete (particularly in the event that a collaborator leaves the project); representations and warranties; and, what happens to the object produced through the project (such as a new device or software game, once the collaboration agreement ceases).

 

    Last updated 201019_1255