Share Ownership Agreement Template for United Arab Emirates

The Share Ownership Agreement is a fundamental document used when establishing or modifying ownership structures in UAE companies. It becomes essential when multiple shareholders are involved, whether in a new company formation, investment round, or corporate restructuring. This agreement must comply with UAE Federal Law No. 32 of 2021 and related regulations, including specific requirements for mainland and free zone companies. The document typically includes detailed provisions on shareholder rights, corporate governance, share transfers, and exit mechanisms, while addressing specific UAE requirements such as local ownership rules and foreign investment restrictions. Share Ownership Agreements are particularly crucial in the UAE context due to the jurisdiction's unique regulatory framework and the need to balance international business practices with local legal requirements.

1. Parties: Identification of all shareholders and the company, including full legal names and addresses as required by UAE law

2. Background: Recitals explaining the context of the agreement and the company's establishment details

3. Definitions and Interpretation: Defined terms and interpretation rules, including Arabic/English language precedence

4. Share Capital and Ownership: Details of share capital, classes of shares, and ownership percentages

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

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

7. Shareholder Meetings: Procedures for general assemblies and shareholder voting in compliance with UAE Companies Law

8. Transfer Restrictions: Limitations on share transfers and required approvals

9. Pre-emptive Rights: Rights of first refusal and procedures for new share issuances

10. Exit Provisions: Mechanisms for shareholder exits including tag-along and drag-along rights

11. Confidentiality: Protection of company and shareholder confidential information

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

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

14. Dispute Resolution: Dispute resolution procedures including UAE court jurisdiction or arbitration

15. General Provisions: Standard boilerplate clauses adapted to UAE law requirements