1.

What About Financing Joint Ventures?

Answer»

You and your Joint Venture partner will NEED to agree:

  • What proportion (if any) of the initial finance will the parties themselves provide and how much will be provided from external sources.
  • If third party FUNDING is being sought, what security and/or recourse to the parties themselves will the LENDER(s) require.
  • Will the parties’ initial INVESTMENT be in cash and/or by contributing assets.
  • If the funding will be through debt rather than equity, or vice versa.

What arrangements will there be for funding, on a continuing basis:

  1.  the working capital requirements
  2.  LOSSES incurred by the joint venture; and/or
  3.  development and expansion costs
  • Will each party be required (or entitled) to contribute to continuing calls for funding, pro-rata to its original investment or otherwise
  • What happens if one of the parties defaults.

You and your Joint Venture partner will need to agree:

What arrangements will there be for funding, on a continuing basis:


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