Virtually every joint venture, whether for an immediate business purpose or long-term research, requires a close relationship between and among the ventures if it is to avoid being doomed to failure from the outset. Many of us in the profession, in an effort to have the client understand the importance of the issues, suggest to the client that it is like a marriage to be successful, all parties must give and take for the benefit of the union. We may also make reference to the often-cited statistic that 50 percent of marriages end in divorce proceedings that involve matrimonial lawyers representing the sparring soon-to-be ex-spouses in dividing up the marital assets. It is becoming increasingly common for the soon-to-be married parties to engage in a written prenuptial plan. Without comment on the state of marriage relationships, it is a good and wise thing to advocate that clients adopt the same thinking while negotiating the joint venture and that they adopt it well in advance of any writing. If there comes a time when the joint venture needs to be unraveled or the purpose for the joint venture no longer exists, the benefits of a clearly thought out process for achieving that end will be appreciated and relieve a lot of the stress.
One of the earliest considerations is whether you want to make an agreement that there is no agreement until a "final agreement document" is signed. Such ventures may start informally with an exchange of letters, with term sheets or outlines of the venture. If any of these are employed, they need to be used carefully and with clear language that they are not enforceable agreements. This may seem like unnecessary advice, but the excitement surrounding the possible venture often makes the parties feel rushed and adverse to anything that may look like a potential roadblock to a deal.
