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Friends And Family Investment Agreement Template for Saudi Arabia

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Key Requirements PROMPT example:

Friends And Family Investment Agreement

"I need a Friends and Family Investment Agreement for a 5 million SAR investment into my tech startup in Riyadh, where three family members will be investing equal amounts, with specific provisions for quarterly profit sharing and a planned exit strategy by March 2025."

Document background
The Friends And Family Investment Agreement is essential for formalizing investment arrangements between family members and close associates in Saudi Arabia. This document has gained increasing importance with Saudi Vision 2030's emphasis on family business governance and private sector growth. It provides a structured framework for family investments while ensuring compliance with both Sharia principles and Saudi regulations. The agreement typically covers investment terms, profit-sharing mechanisms, management rights, reporting requirements, and exit provisions. It's particularly relevant for family businesses seeking to expand or restructure their operations while maintaining clear documentation of family members' rights and obligations. The document helps prevent future disputes by clearly defining each party's role, responsibilities, and financial entitlements while preserving family relationships.
Suggested Sections

1. Parties: Identification of all parties involved in the investment agreement, including full legal names and contact details

2. Background: Context of the investment relationship and purpose of the agreement

3. Definitions: Clear definitions of key terms used throughout the agreement

4. Investment Amount and Structure: Details of the investment amount, payment schedule, and investment structure in compliance with Sharia principles

5. Business Purpose: Detailed description of the business or project being invested in

6. Profit Sharing Mechanism: Sharia-compliant mechanism for sharing profits and losses between parties

7. Management and Control: Rights and responsibilities regarding business management and decision-making

8. Representations and Warranties: Statements of fact and promises made by each party

9. Reporting and Information Rights: Requirements for financial reporting and investor information access

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

11. Exit Provisions: Methods and procedures for parties to exit the investment

12. Dispute Resolution: Procedures for resolving disputes, including reference to Saudi courts or arbitration

13. Governing Law: Specification of Saudi law and Sharia principles as governing law

14. Miscellaneous: Standard provisions including notices, amendments, and entire agreement clauses

Optional Sections

1. Tag-Along Rights: Optional provision giving investors the right to join in sale of shares by other investors - relevant for larger family investments

2. Drag-Along Rights: Optional provision allowing majority investors to force minority investors to join in sale - useful for larger family groups

3. Non-Competition: Restrictions on competitive activities - relevant if investors are involved in similar businesses

4. Confidentiality: Detailed confidentiality provisions - necessary if sensitive business information is involved

5. Islamic Finance Compliance Declaration: Specific declaration of Sharia compliance - useful when required by particular family members

6. Family Council Provisions: Governance structure for family investment decisions - relevant for larger family investment groups

7. Succession Planning: Provisions for handling investment in case of death or incapacity - important for long-term family investments

Suggested Schedules

1. Schedule 1: Investment Details: Detailed breakdown of investment amounts, timing, and payment structure

2. Schedule 2: Business Plan: Detailed business plan and use of investment funds

3. Schedule 3: Profit Sharing Formula: Detailed calculations and examples of profit-sharing mechanism

4. Schedule 4: Reporting Templates: Templates for required financial and operational reports

5. Schedule 5: Key Performance Indicators: Specific metrics for measuring business performance

6. Appendix A: Shareholder Contact Details: Complete contact information for all parties

7. Appendix B: Sharia Compliance Certificate: If obtained, certification of Sharia compliance from relevant authority

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions
















































Clauses









































Relevant Industries

Family Business

Real Estate

Retail

Healthcare

Technology Startups

Manufacturing

Trading

Hospitality

Agricultural Business

Professional Services

Construction

Education

Relevant Teams

Legal

Compliance

Family Office

Investment

Finance

Corporate Governance

Business Development

Risk Management

Wealth Management

Strategic Planning

Relevant Roles

Family Business Owner

Investment Manager

Legal Counsel

Family Office Director

Wealth Manager

Business Development Manager

Corporate Lawyer

Compliance Officer

Financial Advisor

Chief Executive Officer

Chief Financial Officer

Investment Analyst

Family Business Consultant

Succession Planning Advisor

Industries








Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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