A strategic partnership is a relationship between two companies where the result can be outsourcing relationships, joint ventures, mergers etc. It happens when each possesses one or more business assets or expertise. This will help the other to enhance their businesses. When such partnerships take place, there is an agreement to be signed between the two companies. This agreement is known as Strategic Partnership Agreement. It lists down the terms and conditions of the whole agreement. Thus, to prepare the Strategic Partnership Agreement, there are certain guidelines to be followed.
Companies run properly and orderly only if the decision taking body is good. There must be no conflict or disputes of interest and the decision must be taken in consensus. Thus, both the partners must agree with the decisions taken and make sure that this is specifically mentioned in the Strategic Partnership Agreement in order to avoid glitches.
Company can run and move ahead once it has some capital in its assets. So, the partners decide how much to invest and in what ratio. The capital funding can also be done from outside investors or stakeholders. It may also be like one partner only raises the funds and other serves as a workhorse. Hence, make all such details clear in the Strategic Partnership Agreement. Further, mention about the funding in situations when there is more need of money.
Salary / Profit
The most crucial part is the profit distribution between the partners. There have been many cases when the company was shut because of the profit sharing between the two, husband-wife even. Hence, it is always better to mention the profit-sharing ratio in the Strategic Partnership Agreement. It may also happen that one partner wants to keep the profit money in the company to increase brand recognition while the other wants to take away and distribute to shareholders. Such conflicts must not arise as they may build serious repercussions in future.
Death / Disability
These are unfortunate events that may take place unexpectedly in our lives. But when you are in a business, it is better to be prepared for the worse. As you have worked hard and build up an empire, efforts must not go waste. It is always advised to mention your successor who will replace you in case of unfortunate event in the Strategic Partnership Agreement. This will avoid the problems with partners and there is a well organised structure specifying who does what and when, especially to avoid confusions, cat fights and thus, the business continues to run smoothly.
All’s well that ends well. Go with the saying and describe the bad consequences of exit in the Strategic Partnership Agreement. It might happen when the company is in losses, undergo a severe scam, or partners are no more interested to run the business. So, be prepared to know what happens next. Let’s say if another powerful company is ready to take over then in what proportion the amount is distributed to the partners.
Free Strategic Partnership Agreement Templates
Here are previews and download links for these Strategic Partnership Agreement Templates.