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Shareholder Management Agreement Template for Saudi Arabia

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Key Requirements PROMPT example:

Shareholder Management Agreement

"I need a Shareholders Management Agreement for a Saudi Arabian technology startup with three founding shareholders and two venture capital investors, planned to be effective from March 2025, with specific provisions for future funding rounds and anti-dilution protection."

Document background
The Shareholder Management Agreement is a vital document used when establishing or updating the governance framework for companies operating in Saudi Arabia with multiple shareholders. It becomes particularly relevant during company formation, when new shareholders join, or when existing governance structures need formalization. The agreement must comply with Saudi Arabia's Companies Law, Capital Market Authority regulations, and Sharia principles, making it distinct from similar agreements in other jurisdictions. It typically includes comprehensive provisions covering shareholder rights, corporate governance, share transfers, profit distribution, and dispute resolution mechanisms. This document is essential for both private and public companies, family businesses, and joint ventures operating in Saudi Arabia, providing a clear framework for shareholder relationships and corporate governance while ensuring alignment with local legal requirements and business practices.
Suggested Sections

1. Parties: Identification of all shareholders and the company, including full legal names and registration details

2. Background: Context of the agreement, company history, and purpose of the arrangement

3. Definitions and Interpretation: Key terms used throughout the agreement and rules of interpretation

4. Share Capital and Shareholding Structure: Details of company's share capital, shareholding percentages, and share classes

5. Shareholder Rights and Obligations: Core rights and duties of shareholders, including voting rights and capital contribution obligations

6. Management and Governance: Board composition, appointment rights, management structure, and decision-making processes

7. General Assembly Meetings: Procedures for calling and conducting shareholder meetings, voting mechanisms, and quorum requirements

8. Transfer of Shares: Rules governing share transfers, including right of first refusal, tag-along and drag-along rights

9. Dividend Policy: Framework for profit distribution and dividend declarations

10. Reserved Matters: Decisions requiring special majority or unanimous shareholder approval

11. Confidentiality: Obligations regarding company and shareholder information confidentiality

12. Competition and Non-Solicitation: Restrictions on competitive activities and employee solicitation

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

14. Dispute Resolution: Mechanisms for resolving disputes, including Sharia-compliant arbitration provisions

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

Optional Sections

1. Foreign Ownership Provisions: Required when there are foreign shareholders, addressing specific regulations and requirements under Saudi foreign investment laws

2. IPO Preparation: Included when the company plans to go public, outlining pre-IPO requirements and procedures

3. Shareholder Loans: Required when shareholders may provide financing to the company, ensuring Sharia compliance

4. Exit Mechanisms: Detailed procedures for shareholder exits, including put and call options, when sophisticated exit planning is needed

5. Deadlock Resolution: Required for 50/50 joint ventures or where deadlock is a significant risk

6. Anti-Corruption Compliance: Required for international shareholders or when dealing with government contracts

7. Zakat and Tax Provisions: Detailed treatment of Zakat and tax matters when complex tax structures are involved

Suggested Schedules

1. Schedule 1 - Shareholder Details: Complete details of all shareholders including contact information and shareholding percentages

2. Schedule 2 - Company Information: Detailed company information including registration details, licenses, and assets

3. Schedule 3 - Reserved Matters List: Comprehensive list of decisions requiring special approval

4. Schedule 4 - Board Charter: Detailed procedures for board operations and governance

5. Schedule 5 - Business Plan: Initial business plan and strategic objectives

6. Schedule 6 - Share Valuation Methodology: Agreed methods for share valuation in various circumstances

7. Schedule 7 - Dividend Policy Details: Detailed procedures and calculations for dividend distributions

8. Appendix A - Key Management Positions: Description of key management roles and appointment rights

9. Appendix B - Shareholder Funding Requirements: Details of any agreed future funding commitments

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
























































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Relevant Industries

Financial Services

Manufacturing

Real Estate

Technology

Healthcare

Retail

Energy

Mining

Construction

Telecommunications

Professional Services

Hospitality

Education

Transportation & Logistics

Agriculture

Relevant Teams

Legal

Corporate Governance

Compliance

Finance

Board Secretariat

Risk Management

Shareholder Relations

Corporate Affairs

Investment

Strategy

Executive Management

Relevant Roles

Chief Executive Officer

Chief Legal Officer

Corporate Secretary

Legal Counsel

Compliance Officer

Board Director

Chief Financial Officer

Managing Director

Shareholder Relations Manager

Corporate Governance Officer

Investment Manager

Risk Management Officer

Business Development Director

Strategy Director

Company Registrar

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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