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Startup Investment Agreement Template for Saudi Arabia

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Key Requirements PROMPT example:

Startup Investment Agreement

"I need a Startup Investment Agreement for a Saudi technology company receiving a 5 million SAR investment from a foreign venture capital firm, with completion expected by March 2025."

Document background
The Startup Investment Agreement is a crucial document used when investors are making an equity investment in a Saudi Arabian startup company. This agreement is particularly relevant in the context of Saudi Arabia's Vision 2030 initiative, which aims to foster entrepreneurship and increase private sector participation in the economy. The document must comply with Saudi Arabian legal requirements, including the Companies Law of 2015, Foreign Investment Law, and where applicable, Capital Market Authority regulations and Shariah principles. It typically includes detailed provisions on investment terms, shareholder rights, corporate governance, share transfer restrictions, and exit mechanisms. The agreement is essential for protecting both investor and founder interests while ensuring the investment structure supports the startup's growth objectives and complies with local regulatory requirements.
Suggested Sections

1. Parties: Identification of all parties including the Company, Founders, and Investors with their full legal names and addresses as required under Saudi law

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

3. Definitions: Definitions of key terms used throughout the agreement, including Arabic terms where relevant

4. Investment Terms: Details of the investment amount, valuation, and number of shares being issued

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

6. Warranties and Representations: Standard warranties from the Company and Founders, including compliance with Saudi laws

7. Share Rights and Capital Structure: Description of share classes, rights attached to shares, and capital structure post-investment

8. Board Composition and Governance: Board structure, appointment rights, and corporate governance provisions

9. Reserved Matters: Decisions requiring investor approval, including statutory requirements under Saudi law

10. Transfer Restrictions: Restrictions on share transfers and foreign ownership limitations if applicable

11. Exit and Liquidation Rights: Provisions regarding company sale, IPO, or liquidation

12. Confidentiality: Confidentiality obligations and permitted disclosures

13. Notices: Process for formal communications between parties

14. Governing Law and Jurisdiction: Confirmation of Saudi law as governing law and jurisdiction of Saudi courts

Optional Sections

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

2. Founder Vesting: Vesting schedule for founder shares, typically used with first-time founders

3. Employee Share Option Pool: Creation and terms of an ESOP, if planned

4. Tag-Along Rights: Co-sale rights for investors, common in minority investments

5. Drag-Along Rights: Ability to force minority shareholders to join in a sale, used in larger investments

6. Non-Compete and Non-Solicit: Restrictions on founder competition and employee solicitation

7. Shariah Compliance: Specific provisions ensuring Shariah compliance, if required

8. Intellectual Property Assignment: Assignment of IP rights, important for technology startups

9. Foreign Investment Provisions: Additional provisions required for foreign investors

Suggested Schedules

1. Schedule 1: Cap Table: Current and post-investment capitalization table

2. Schedule 2: Company Information: Detailed company information including registration details, licenses, and permits

3. Schedule 3: Warranties: Detailed warranties given by the Company and Founders

4. Schedule 4: Reserved Matters: Detailed list of matters requiring investor approval

5. Schedule 5: Completion Requirements: Detailed conditions precedent and completion deliverables

6. Schedule 6: Key Terms: Summary of key investment terms and valuation details

7. Schedule 7: Business Plan: Company's business plan and financial projections

8. Appendix A: Board Regulations: Detailed board procedures and governance rules

9. Appendix B: Share Rights: Detailed description of rights attached to different share classes

Authors

Alex Denne

Head of Growth (Open Source Law) @ 红杏直播 | 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

E-commerce

Financial Technology

Healthcare Technology

Education Technology

Clean Energy

Logistics and Transportation

Manufacturing

Retail

Food and Beverage

Real Estate Technology

Agricultural Technology

Media and Entertainment

Telecommunications

Professional Services

Biotechnology

Relevant Teams

Legal

Finance

Corporate Development

Investment

Compliance

Executive Management

Board of Directors

Corporate Governance

Risk Management

Strategy

Business Development

Relevant Roles

Chief Executive Officer

Chief Financial Officer

Chief Legal Officer

General Counsel

Investment Manager

Venture Capital Partner

Corporate Lawyer

Investment Director

Managing Partner

Business Development Director

Startup Founder

Company Secretary

Legal Counsel

Compliance Officer

Board Member

Investment Analyst

Due Diligence Officer

Financial Controller

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, 聽Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination, 聽Severance Pay, Governing Law, Entire Agreemen

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