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Share Subscription And Shareholders Agreement

Share Subscription And Shareholders Agreement Template for United Arab Emirates

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Key Requirements PROMPT example:

Share Subscription And Shareholders Agreement

"I need a Share Subscription and Shareholders Agreement under UAE law for a tech startup receiving a Series A investment of AED 5 million, with specific provisions for minority shareholder protection and a planned exit through IPO by 2025."

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Document background
The Share Subscription And Shareholders Agreement is a crucial document used in UAE corporate transactions when new investors are joining a company while simultaneously establishing the framework for ongoing shareholder relationships. It is particularly relevant in the UAE context where careful consideration must be given to foreign ownership restrictions, local sponsor requirements, and compliance with Federal Law No. 32 of 2021. The document serves multiple purposes: it details the terms of the share subscription including payment and issuance of shares, establishes corporate governance mechanisms, protects minority shareholder rights, and provides clear exit mechanisms. This agreement is essential for both private and public companies seeking investment while ensuring compliance with UAE regulatory requirements and market practices.
Suggested Sections

1. Parties: Identification of all parties to the agreement including the Company, existing shareholders, and new subscribers

2. Background: Context of the transaction, company information, and purpose of the agreement

3. Definitions and Interpretation: Definitions of key terms and interpretation rules for the agreement

4. Subscription of Shares: Details of the share subscription including number of shares, price, and payment terms

5. Completion: Conditions precedent, completion obligations, and timing of the share subscription

6. Warranties and Representations: Warranties given by the company, existing shareholders, and subscribers

7. Management and Control: Board composition, appointment rights, and management structure

8. Shareholder Meetings: Procedures for shareholder meetings, voting rights, and reserved matters

9. Transfer of Shares: Share transfer restrictions, pre-emptive rights, and right of first refusal

10. Tag and Drag Rights: Co-sale rights and forced sale provisions

11. Exit Provisions: Mechanisms for exit including IPO, put options, and sale processes

12. Confidentiality: Obligations regarding confidential information

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

14. Term and Termination: Duration of the agreement and termination provisions

15. General Provisions: Standard boilerplate clauses including notices, amendments, and governing law

Optional Sections

1. Anti-Dilution Rights: Protection for investors against future dilution - used when investors require specific protection

2. Intellectual Property Rights: IP ownership and protection provisions - relevant for technology or IP-heavy companies

3. Dividend Policy: Specific dividend distribution requirements - used when parties want predetermined dividend arrangements

4. Dead Lock Resolution: Mechanisms to resolve shareholder disputes - important for 50/50 joint ventures

5. Information Rights: Special information access rights - relevant for minority shareholders requiring enhanced protection

6. Employee Share Scheme: Provisions for employee share ownership - used when company plans to implement ESOP

7. Islamic Finance Compliance: Specific provisions ensuring Shariah compliance - required for Islamic finance structures

8. Local Partner Provisions: Specific provisions for local ownership requirements - needed for certain regulated industries

Suggested Schedules

1. Share Capital and Shareholding Structure: Details of current and post-subscription shareholding structure

2. Subscription Details: Detailed terms of the share subscription including valuation methodology

3. Company Information: Key company details including corporate registration, licenses, and assets

4. Reserved Matters: List of decisions requiring special approval

5. Business Plan: Initial business plan and key milestones

6. Warranties: Detailed warranties given by various parties

7. Board Regulations: Detailed procedures for board meetings and decision-making

8. Form of Deed of Adherence: Template for new shareholders joining the agreement

9. Key Performance Indicators: Agreed performance metrics and targets

10. Completion Obligations: Detailed list of documents and actions required at completion

Authors

Alex Denne

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

Linkedin in social icon imageX social icon image
alex.den.21@genieai.co
Relevant legal definitions
Affiliate
Agreement
Anti-Dilution Rights
Articles of Association
Board
Business
Business Day
Business Plan
Call Option
Company
Completion
Completion Date
Confidential Information
Deed of Adherence
Director
Drag Along Right
Encumbrance
Event of Default
Exercise Notice
Exit Event
Fair Market Value
Financial Year
Group
Initial Business Plan
Intellectual Property Rights
Investment Amount
Investor Director
Key Management
Management Accounts
Material Adverse Change
Memorandum of Association
New Securities
Ordinary Resolution
Parties
Pre-emptive Right
Put Option
Qualified IPO
Reserved Matters
Shareholder
Shareholder Loan
Shares
Special Resolution
Subscription Price
Subscription Shares
Tag Along Right
Trade Sale
Transfer
Valuation
Warranties
Clauses
Interpretation
Share Subscription
Payment Terms
Completion Conditions
Completion Obligations
Warranties and Representations
Board Composition
Board Meetings
Shareholder Meetings
Reserved Matters
Information Rights
Pre-emptive Rights
Share Transfer Restrictions
Tag Along Rights
Drag Along Rights
Exit Rights
Put Option
Call Option
Anti-Dilution
Dividend Policy
Non-Competition
Non-Solicitation
Confidentiality
Intellectual Property
Default
Deadlock Resolution
Term and Termination
Assignment
Notices
Governing Law
Dispute Resolution
Indemnification
Force Majeure
Entire Agreement
Severability
Amendments
Costs and Expenses
Relevant Industries

Technology

Real Estate

Manufacturing

Healthcare

Financial Services

Retail

E-commerce

Construction

Energy

Transportation

Education

Professional Services

Hospitality

Media and Entertainment

Telecommunications

Relevant Teams

Legal

Finance

Corporate Development

Compliance

Executive Leadership

Board Secretariat

Investment

Strategy

Shareholder Relations

Risk Management

Relevant Roles

Chief Executive Officer

Chief Financial Officer

Legal Counsel

Corporate Secretary

Investment Director

Managing Director

Board Member

Compliance Officer

Finance Director

Business Development Director

Strategy Director

General Counsel

Investment Manager

Corporate Development Manager

Shareholder Relations Manager

Industries
UAE Federal Law No. 32 of 2021 (Companies Law): The primary legislation governing companies in the UAE, covering incorporation, shareholding structures, corporate governance, and shareholder rights and obligations
UAE Federal Decree-Law No. 19 of 2018 (FDI Law): Regulates foreign direct investment in the UAE, including foreign ownership restrictions and permitted activities for foreign investors
UAE Federal Law No. 4 of 2012 (Competition Law): Governs competition aspects and merger control provisions that might be relevant for share acquisitions and corporate restructuring
SCA Board of Directors' Decision No. (3/R.M) of 2017: Regulates the promotion and introduction of securities, including private placements and share offerings
UAE Federal Decree-Law No. 14 of 2018 (Central Bank Law): Relevant for any banking sector requirements and financial regulations affecting share transfers and corporate ownership
UAE Federal Decree-Law No. 33 of 2021 (Commercial Transactions Law): Governs commercial transactions including aspects of share transfers and commercial contracts
UAE Corporate Governance Resolution No. 3 of 2020: Sets out corporate governance requirements for public joint stock companies and certain private companies
UAE Federal Decree-Law No. 47 of 2022 (Corporate Tax Law): Addresses taxation aspects of corporate transactions including share transfers and corporate restructuring
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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