Stock Investment Agreement Template for United Arab Emirates

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Key Requirements PROMPT example:

Stock Investment Agreement

"I need a Stock Investment Agreement for a UAE-based technology startup receiving a 5 million AED investment from a Singapore-based venture capital firm, with completion planned for March 2025 and including standard minority investor protections."

Document background
The Stock Investment Agreement is a crucial document used in the UAE when an investor (either corporate or individual) seeks to acquire shares in a company. This agreement, governed by UAE law, must comply with Federal Law No. 32 of 2021 (Companies Law) and relevant securities regulations. It is typically used for private equity investments, venture capital transactions, or strategic corporate investments. The document comprehensively covers investment terms, shareholder rights, governance structures, and exit mechanisms while addressing specific UAE requirements such as foreign ownership restrictions and local regulatory approvals. The agreement serves as the primary document protecting both investor and company interests, often forming part of a larger transaction document suite that may include shareholder agreements and corporate governance documents.
Suggested Sections

1. Parties: Identification of all parties to the agreement, including the company, existing shareholders, and investor(s)

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

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

4. Investment Terms: Details of the investment amount, number of shares, price per share, and payment terms

5. Completion Mechanics: Process and conditions for completing the investment, including conditions precedent

6. Representations and Warranties: Statements of fact and assurances from the company and existing shareholders

7. Investor Rights: Key rights of the investor, including board representation and information rights

8. Transfer Restrictions: Limitations on the transfer of shares and related procedures

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

10. Corporate Governance: Board composition, voting rights, and reserved matters

11. Confidentiality: Provisions regarding the protection of confidential information

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

13. General Provisions: Standard boilerplate clauses including notices, governing law, and dispute resolution

Optional Sections

1. Anti-dilution Protection: Protection against future down rounds, typically included for significant investments

2. Preferred Rights: Special rights attached to preferred shares, if applicable

3. UAE Local Ownership Provisions: Required when foreign investors are involved and local ownership requirements apply

4. Pre-emptive Rights: Right to participate in future funding rounds, typically for substantial investments

5. Strategic Cooperation: For strategic investors bringing additional value beyond capital

6. Employee Stock Option Pool: If the investment includes or affects an ESOP

7. Shariah Compliance: Required for Islamic investors or if the company operates under Islamic principles

8. Put Option Rights: Exit rights for investors in specific circumstances

Suggested Schedules

1. Schedule 1 - Company Information: Detailed corporate information including shareholding structure and subsidiaries

2. Schedule 2 - Conditions Precedent: List of conditions to be satisfied before completion

3. Schedule 3 - Warranties: Detailed warranties given by the company and existing shareholders

4. Schedule 4 - Completion Requirements: Detailed steps and documents required for completion

5. Schedule 5 - Reserved Matters: List of decisions requiring investor approval

6. Schedule 6 - Form of Deed of Adherence: Template for new shareholders to accede to the agreement

7. Schedule 7 - Management Accounts: Latest financial statements and management accounts

8. Schedule 8 - Intellectual Property: Details of company's IP rights and registrations

9. Appendix A - Share Capital Table: Pre and post-investment shareholding structure

10. Appendix B - Corporate Authorizations: Required corporate and regulatory approvals

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

Relevant legal definitions
Clauses
Relevant Industries

Technology

Real Estate

Financial Services

Healthcare

Manufacturing

E-commerce

Retail

Energy

Transportation

Education

Hospitality

Construction

Professional Services

Media and Entertainment

Telecommunications

Relevant Teams

Legal

Finance

Corporate Development

Investment

Compliance

Executive Management

Board of Directors

Corporate Secretariat

Risk Management

Strategy

Relevant Roles

Chief Executive Officer

Chief Financial Officer

Chief Legal Officer

Investment Director

Corporate Lawyer

Investment Manager

Company Secretary

Board Director

Managing Director

Finance Director

Compliance Officer

General Counsel

Private Equity Manager

Venture Capital Manager

Corporate Development Manager

Financial Controller

Legal Counsel

Investment Analyst

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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