Collaboration Agreement

What is a collaboration agreement?

A collaboration agreement is a legal document that defines terms and conditions for cooperation between several parties towards achieving specific goals. The collaboration agreement template is a vital legal tool that is being used widely in business development, real estate markets, scientific research development, startups, and other domains. The basic collaboration agreement usually covers:

• identification details of the parties involved;
• purpose and goals of the collaboration;
• type and amount of financial contribution;
• terms for termination;
• confidentiality requirements;
• non-compete limitations; and
• dispute resolution clause.

The parties involved in a collaborative agreement are individuals, partnerships, and various organizations, including non-profits and businesses.

The present template is commonly used in conjunction with other legal documents, including confidentiality agreements, non-compete agreements, etc. However, the collaboration agreement template should not be confused with other similar documents, including:

• Joint Venture Agreement. This document is being used for more complex and long-term projects. Along with signing this document, parties tend to register an official legal entity to run the business.
• General Partnership Agreement. This document is aimed at creating a business entity that is officially recognized at state and federal levels. Besides that, the parties to a general partnership agreement are fully liable for any debt or losses incurred by the partnership. This, however, is not the case for a collaboration agreement.

What does a sample collaboration agreement include?

A sample collaboration agreement is a flexible document, as there are no requirements for its content or format. At the same time, there are a number of key elements without which the document may not be fully complete. Below we made a short list of all important components a solid collaborative agreement should have.

Purpose of the Collaboration

This is a legal “heart” of every sample collaboration agreement. This is where parties should describe in detail goals they wish to pursue and achieve during their collaboration. For example, if you are drafting a research collaboration agreement, you may include a list of scientific goals the parties want to pursue together.

There is no need, however, to create a detailed plan of work, as parties may create a separate document in the future to address a specific timeline or milestones.

Finally, it is important to include an additional disclaimer stating that the collaboration is not for the purpose of creating employment, partnership, or other business relationships between the parties.

Responsibilities

Another important element for every sample collaboration agreement is to list the duties and responsibilities of all parties involved. This clause adds a lot of clarity regarding everyone’s tasks. Besides that, it makes it easier to track if either party fails to contribute to the collaboration.

For example, if you are drafting a business collaboration agreement, one party could be responsible for finding new clients or projects, while the other could be responsible for the people and cost management. Make sure that each party’s obligations are duly listed in the text of a contract.

Profit Sharing

If the collaboration is successful and it brings some visible cash results, parties may face internal disputes regarding the profit sharing. Thus, it is vital to define all sensitive details at the very start. The best way to do that is to create a collaboration agreement with a profit-sharing clause. The template should define each party’s percentage from the generated profit.

There are few widely used profit-sharing models in the collaboration projects:

• profits are being split in equal shares between all parties;
• profits are distributed pro rata to a party’s initial financial contribution; or
• each party gets a fixed percentage.

Confidentiality Obligations

In the course of collaboration, either party may share certain sensitive information related to their business or identity with other parties. Such a sensitive information may include financial data, trade secrets, personal life details, business’s margin etc. All those types of sensitive information are normally being referred to as confidential information.

Therefore, parties to a collaboration contract agreement want to protect such information against further disclosure to third parties. Such a protection could be done in either of the following ways:

• by inclusion of a non-disclosure clause into the text of a collaboration agreement; or
• by signing a separate confidentiality agreement.

Intellectual Property Rights

Another important element a collaboration research agreement should have is a split of intellectual property (“IP”) rights between the parties. IP rights usually have various forms, including copyright, designs, programming codes, designs, etc.

A professional collaboration agreement with IP ownership clause is a must in case IP rights are created during the collaboration. IP rights that emerge before the collaboration starts do not get “legal protection” in the present contract.

This clause has an increased importance, especially for an influencer collaboration agreement template, because a personal brand, trademark, and copyright are involved.

Division of IP rights could happen in either of the following ways:

• IP rights must belong to one party in full;
• some IP rights must belong in full to one party, while the rest belong to another;
• IP rights could be shared equally by all parties of the collaboration; or
• any other arrangement (e.g., the percentage of ownership depends on each party’s financial contribution).

Duration

The duration of the collaboration is another key element parties should agree upon. The collaboration project could last:

• until a specific date in the future;
• until a specific goal is achieved (e.g., this is especially common for collaboration research agreements);
• until the occurrence of specific events (e.g., absence of profit within a certain period of time).

Either party should have a right to exit the collaboration at any time. Therefore, every collaboration agreement sample must provide a notice period. The duration of a notice period should be enough for the remaining parties to prepare for such an exit and to rearrange the work. Depending on the costs involved and duration of the project, the notice period could be between one and several months.

Dispute Resolution

In the course of the collaboration, parties could easily disagree on something, especially in long-lasting projects. Therefore, having a solid but simple dispute resolution clause is a good addition for a collaboration agreement.

The conflict resolution process under any business collaboration agreement has several phases. The first stage is when parties attempt to resolve the conflict peacefully, or by means of internal mediation. If this is not possible, the second state usually involves arbitration. For the arbitration, the parties must indicate the number of arbitrators who should resolve the dispute and select the laws of a state that shall apply to that dispute.

Who can use this collaboration agreement sample?

The audience who can use a collaboration agreement template is relatively wide and includes:

• Small businesses or startups that want to cooperate together (e.g., to ease competition, to reach new markets, to improve visibility, etc.);
• Research institutions and scientific organizations (e.g., to develop medicines, to make group studies, etc.); and
• Influencers and other creative collaborators (e.g., to achieve more visibility on social media platforms, marketing promotion of goods or services).

How to customize a collaboration agreement at FasterDraft?

To get a fully customized legal document template, follow a few easy steps below:

1. Click the “Create Document” button.
2. Answer simple questions in the form.
3. Select a template’s format—collaboration agreement PDF or Word.
4. Make a payment.
5. Download, sign and use instantly the document.