Photovoltaic bracket joint venture processing

How can a joint venture plan a portfolio of projects?

If the joint venture plans a portfolio of projects, one project company could be purchased while the others stay under the joint venture. Here again, it is a good idea to attach a form of membership interest purchase agreement, purchase and sale agreement or build-own-transfer agreement to the joint venture agreement as an exhibit.

How do joint venture agreements work?

Usually there are commercial agreements between one or more of the joint venture parties and the joint venture vehicle (e.g. to supply operation and maintenance services or to buy the power generated) and the joint venture parties will agree to what extent these arrangements are formed and seek to administer them on arm’s length terms.

Should a joint venture agreement cover multiple projects?

If the joint venture arrangement will cover multiple projects to be developed over time, then the joint venture agreement is more likely to take the form of a framework-type structure where additional projects may be added as certain predetermined development criteria are met.

What happens when a joint venture is formed?

Joint venture partners do not always consider these issues when the joint venture is formed and instead wait until a sale is imminent. These types of negotiations between joint venture partners may slow down the sale process. Joint venture agreements usually limit the ability of the partners to transfer their interests.

What happens if a JV partner disputes a project's scope of work?

Disputes can arise between JV partners absent a clear allocation of risk and delineation of responsibilities in connection with the project’s scope of work. This is particularly relevant on renewable energy projects, where untested technology may increase the risk of cost overruns and delay.

What are the limitations of a joint venture agreement?

Joint venture agreements usually limit the ability of the partners to transfer their interests. The restrictions may extend upstream to changes in control. There may be drag-along rights or tag-along rights.