Share Investment Agreement for United Arab Emirates

Share Investment Agreement Template for United Arab Emirates

A Share Investment Agreement governed by UAE law is a comprehensive legal document that establishes the terms and conditions under which an investor acquires shares in a UAE company. The agreement includes detailed provisions on investment amount, share allocation, shareholder rights, warranties, and governance structures, all tailored to comply with UAE Federal Law No. 32 of 2021 (Companies Law) and related regulations. It addresses key aspects such as foreign ownership restrictions, regulatory approvals, and specific UAE compliance requirements, while incorporating international investment protection standards adapted to the UAE legal framework.

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What is a Share Investment Agreement?

A Share Investment Agreement is essential for any equity investment transaction in the UAE, providing the legal framework for share acquisition and ongoing shareholder relationships. This document is typically used when investors (local or foreign) seek to acquire a stake in a UAE company, whether for strategic expansion, venture capital investment, or private equity deals. The agreement must carefully balance international investment practices with UAE legal requirements, particularly regarding foreign ownership restrictions and local corporate governance rules. It includes crucial elements such as investment terms, shareholder rights, transfer restrictions, and exit mechanisms, all structured to ensure enforceability under UAE law. The document becomes particularly important in the context of the UAE's evolving commercial landscape and its position as a major regional investment hub.

What sections should be included in a Share Investment Agreement?

1. Parties: Identification of the investor(s), company, and existing shareholders

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

3. Definitions: Key terms used throughout the agreement including Share Capital, Investment Amount, Completion Date

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

5. Conditions Precedent: Conditions that must be satisfied before completion of the investment

6. Completion: Process and requirements for closing the investment transaction

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

8. Investor Rights: Special rights granted to the investor including board representation, veto rights, information rights

9. Transfer Restrictions: Limitations on share transfers, right of first refusal, tag-along and drag-along rights

10. Confidentiality: Obligations regarding confidential information

11. Governing Law and Jurisdiction: UAE law as governing law and jurisdiction for disputes

12. General Provisions: Standard boilerplate clauses including notices, amendments, entire agreement

What sections are optional to include in a Share Investment Agreement?

1. Anti-dilution Protection: Protection for investors against future down rounds, used in venture capital investments

2. Reserved Matters: List of actions requiring investor approval, used when investor requires veto rights

3. Exit Rights: Provisions regarding IPO, trade sale, or other exit mechanisms, used in venture capital or private equity investments

4. Management Provisions: Detailed management structure and decision-making process, used in active investments

5. Dividend Policy: Specific provisions regarding dividend distributions, used when regular distributions are expected

6. UAE Commercial Compliance: Specific provisions ensuring compliance with UAE foreign ownership restrictions, used when foreign investors are involved

What schedules should be included in a Share Investment Agreement?

1. Schedule 1 - Company Information: Details of the company including corporate information, capital structure, subsidiaries

2. Schedule 2 - Warranties: Detailed warranties given by the company and existing shareholders

3. Schedule 3 - Reserved Matters: Comprehensive list of matters requiring investor approval

4. Schedule 4 - Completion Requirements: Detailed list of documents and actions required for completion

5. Schedule 5 - Business Plan: Company's business plan and financial projections

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

7. Appendix B - Board Resolution: Board resolution approving the investment

8. Appendix C - Shareholders Resolution: Shareholders resolution approving the investment

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

Publisher

Genie AI

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Technology

Real Estate

Financial Services

Healthcare

Manufacturing

Retail

Energy

Infrastructure

E-commerce

Telecommunications

Professional Services

Education

Tourism and Hospitality

Relevant Teams

Legal

Finance

Corporate Development

Investment

Compliance

Board of Directors

Executive Leadership

Corporate Secretariat

Risk Management

Strategy

Relevant Roles

Chief Executive Officer

Chief Financial Officer

Chief Legal Officer

Investment Director

Corporate Lawyer

Investment Manager

Business Development Director

Company Secretary

Compliance Officer

Finance Director

Managing Partner

Board Member

General Counsel

Private Equity Manager

Venture Capital Manager

Corporate Development Manager

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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