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The Joint Venture Agreement Between Two Companies is a crucial document used when two entities decide to combine their resources, expertise, and operations in Indonesia. This agreement is particularly relevant in the context of Indonesia's foreign investment landscape, where international companies often partner with local entities to establish a presence in the market. The document must comply with Indonesian regulations, including the Investment Law (Law No. 25 of 2007) and Company Law (Law No. 40 of 2007), while addressing critical aspects such as capital structure, management control, profit sharing, and operational responsibilities. It requires careful consideration of sector-specific regulations, foreign ownership limitations, and mandatory local language requirements. The agreement serves as the foundational document for the joint venture's governance and operations, protecting both parties' interests while ensuring regulatory compliance.

1. Parties: Identification of the joint venture parties, including their full legal names, registration numbers, and registered addresses

2. Background: Recitals explaining the context of the joint venture, each party's expertise, and their intention to collaborate

3. Definitions and Interpretation: Definitions of key terms used throughout the agreement and rules for interpreting the agreement

4. Joint Venture Company Formation: Details of the new JV company, including name, business objectives, registered office, and initial capital structure

5. Capital Contributions: Specification of initial and future capital contributions from each party, including valuation of non-cash contributions

6. Ownership and Share Structure: Distribution of shares, classes of shares, and any restrictions on share transfers

7. Management and Governance: Board composition, voting rights, reserved matters, and management structure of the JV company

8. Business Plan and Budget: Initial business plan, annual budget requirements, and process for modifications

9. Financial Matters: Financial management, dividend policy, accounting principles, and audit requirements

10. Shareholders' Obligations: Key responsibilities and commitments of each party to the joint venture

11. Non-Competition and Confidentiality: Restrictions on competing activities and protection of confidential information

12. Intellectual Property Rights: Ownership and licensing of IP brought into or developed by the joint venture

13. Term and Termination: Duration of the agreement and circumstances allowing for termination

14. Exit Provisions: Mechanisms for parties to exit the joint venture, including put and call options, deadlock resolution

15. Governing Law and Dispute Resolution: Choice of Indonesian law and dispute resolution procedures

16. General Provisions: Standard clauses including notices, amendments, entire agreement, and language requirements