Document background
The Co-Founder Agreement is a crucial document for any business venture in Saudi Arabia where multiple founders are involved in establishing and operating a company. It is particularly relevant in the context of Saudi Arabia's Vision 2030, which has created a more dynamic business environment and encouraged entrepreneurship across various sectors. This agreement needs to comply with Saudi Companies Law, Commercial Registration requirements, and where applicable, Shariah principles. It typically includes detailed provisions on capital contributions, profit sharing, management rights, decision-making processes, and exit mechanisms. The document serves as a foundational contract that helps prevent future disputes by clearly defining each co-founder's roles, responsibilities, and equity stakes while ensuring alignment with Saudi Arabian regulatory requirements and business practices. It's especially important given the increasing number of technology startups and innovative businesses emerging in the Kingdom, as well as traditional family businesses transitioning to more formal corporate structures.
