Operating Agreement For Non Profit Corporation Template for Saudi Arabia

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Key Requirements PROMPT example:

Operating Agreement For Non Profit Corporation

"I need an Operating Agreement For Non Profit Corporation for a new educational foundation in Riyadh that will focus on youth development and digital literacy, with plans to establish three branches across Saudi Arabia by March 2025. The agreement should include provisions for multiple branch operations and technology-focused program activities."

Document background
The Operating Agreement For Non Profit Corporation is a foundational document required when establishing and operating a non-profit organization in Saudi Arabia. It serves as the primary governance document that outlines the organization's structure, management, and operational procedures while ensuring compliance with Saudi regulations and Shariah principles. This document is essential for registration with the Ministry of Human Resources and Social Development and the National Center for Non-Profit Sector, typically required during the initial formation of a non-profit entity or when updating existing governance structures. The agreement must align with Saudi Vision 2030's non-profit sector development goals and include provisions for transparency, financial control, and regulatory reporting.
Suggested Sections

1. Parties: Identification of the founding members and the non-profit corporation

2. Background: Context of the organization's formation and its charitable/non-profit purposes

3. Definitions: Key terms used throughout the agreement, including Arabic legal terms and their English equivalents

4. Formation and Purpose: Legal establishment details, mission statement, and charitable objectives in compliance with Saudi regulations

5. Shariah Compliance: Declaration and provisions ensuring compliance with Islamic law principles

6. Membership: Categories of membership, rights, responsibilities, and admission procedures

7. Board of Directors: Composition, qualifications, appointment process, terms, and responsibilities of the board

8. Management Structure: Executive positions, reporting lines, and management responsibilities

9. Meetings and Voting: Procedures for board and member meetings, voting requirements, and quorum rules

10. Financial Management: Budget procedures, financial controls, and reporting requirements

11. Regulatory Compliance: Compliance with Saudi government regulations, reporting obligations, and oversight requirements

12. Asset Management: Guidelines for managing organization's assets and restrictions on use of funds

13. Dissolution Procedures: Process for dissolution and distribution of assets in compliance with Saudi law

14. Amendment Procedures: Process for modifying the operating agreement

15. Governing Law: Explicit statement of Saudi law governance and Shariah compliance

Optional Sections

1. International Operations: Required if the organization plans to operate or receive funding from outside Saudi Arabia

2. Subsidiary Organizations: Include if the non-profit plans to establish or manage other entities

3. Intellectual Property: Necessary if the organization will develop or use significant intellectual property

4. Endowment Management: Required if the organization will manage waqf (Islamic endowment) funds

5. Volunteer Management: Include if the organization will rely significantly on volunteer work

6. Branch Operations: Required if the organization plans to operate multiple branches within Saudi Arabia

7. Research Activities: Include if the organization will conduct research activities

8. Commercial Activities: Required if the organization will engage in permitted commercial activities to support its non-profit mission

Suggested Schedules

1. Organization Structure Chart: Detailed organizational hierarchy and reporting relationships

2. Board Member Details: Initial board members' information and qualifications

3. Financial Procedures Manual: Detailed financial management and control procedures

4. Compliance Checklist: List of regulatory requirements and compliance procedures

5. Required Government Approvals: List of necessary permits and licenses

6. Conflict of Interest Policy: Detailed procedures for managing conflicts of interest

7. Internal Governance Policies: Detailed operational policies and procedures

8. Zakat and Tax Guidelines: Procedures for managing zakat obligations and maintaining tax-exempt status

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

Charitable Organizations

Education

Healthcare

Social Services

Religious Organizations

Cultural Preservation

Environmental Conservation

Community Development

Humanitarian Aid

Research and Development

Sports and Recreation

Arts and Culture

Youth Development

Women's Empowerment

Disability Services

Relevant Teams

Legal

Compliance

Finance

Operations

Board Secretariat

Risk Management

Corporate Governance

Internal Audit

Strategy

Programs Management

Administrative Affairs

Shariah Advisory

Relevant Roles

Chief Executive Officer

Executive Director

Board Chairman

Board Member

Legal Counsel

Compliance Officer

Financial Controller

Program Director

Operations Manager

Corporate Secretary

Risk Manager

Governance Officer

Audit Committee Member

Treasurer

Head of Strategy

Shariah Advisor

Industries
Civil Society Organizations Law: Royal Decree No. M/8 of 1437H (2016) - The primary law governing non-profit organizations in Saudi Arabia, establishing requirements for formation, registration, and operation of civil society organizations
National Center for Non-Profit Sector Law: Established by Council of Ministers Resolution No. 127 (2021) - Regulates and supervises the non-profit sector, including licensing requirements and operational guidelines
Anti-Money Laundering Law: Royal Decree No. M/20 of 1439H (2018) - Includes specific provisions for non-profit organizations to prevent money laundering and ensure financial transparency
Companies Law: Royal Decree No. M/3 of 1437H (2015) - While primarily for commercial entities, certain provisions apply to corporate governance structure and management principles
Labor Law: Royal Decree No. M/51 (2005) and its amendments - Governs employment relationships and must be considered for staff-related provisions in the operating agreement
Zakat, Tax and Customs Authority Regulations: Regulations governing zakat and tax obligations for non-profit organizations, including exemptions and reporting requirements
Ministry of Human Resources and Social Development Regulations: Regulatory framework for social development activities and non-profit sector oversight, including operational guidelines and reporting requirements
Saudi Vision 2030 Non-Profit Sector Regulations: Strategic framework and regulations aimed at developing the non-profit sector as part of Saudi Vision 2030, including governance standards and operational guidelines
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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