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Shareholder Redemption Agreement Template for United Arab Emirates

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Key Requirements PROMPT example:

Shareholder Redemption Agreement

"I need a Shareholder Redemption Agreement for my UAE-based technology company to repurchase 25% of shares from a departing founder by March 2025, with payment to be made in three installments."

Document background
The Shareholder Redemption Agreement is a critical document used when a UAE company wishes to repurchase its own shares from existing shareholders, whether for treasury purposes, capital reduction, or exit arrangements. This document is essential in scenarios such as shareholder exits, corporate restructuring, or strategic realignment of ownership structures. The agreement must comply with UAE Federal Law No. 32 of 2021 and other relevant regulations, including specific free zone requirements where applicable. It typically includes detailed provisions on share valuation, payment mechanisms, conditions precedent, completion procedures, and necessary regulatory approvals. The document becomes particularly important in private companies where share transferability is restricted and in situations requiring careful consideration of minority shareholder rights and corporate governance principles.
Suggested Sections

1. Parties: Identification of the Company and the Selling Shareholder(s)

2. Background: Context of the agreement, including company details, current shareholding structure, and reason for redemption

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

4. Agreement to Redeem: Core agreement for the company to redeem shares from the selling shareholder(s)

5. Purchase Price and Payment Terms: Agreed value of shares and method/timeline of payment

6. Conditions Precedent: Prerequisites that must be satisfied before redemption can occur

7. Completion Mechanics: Step-by-step process for executing the redemption

8. Representations and Warranties: Statements of fact and assurances from both parties

9. Pre-Completion Obligations: Parties' obligations between signing and completion

10. Post-Completion Obligations: Actions required after the redemption is completed

11. Confidentiality: Obligations regarding confidential information

12. Notices: Process for formal communications between parties

13. Governing Law and Jurisdiction: Specification of UAE law and relevant courts

14. General Provisions: Standard boilerplate clauses including severability, entire agreement, etc.

Optional Sections

1. Tag-Along Rights: Include when other shareholders should have the right to participate in the redemption

2. Drag-Along Rights: Include when majority shareholders can force minority shareholders to participate

3. Non-Competition and Non-Solicitation: Include when the selling shareholder held a management position or had access to sensitive information

4. Tax Provisions: Include when international shareholders are involved or tax implications need specific addressing

5. Dispute Resolution: Include when parties prefer arbitration or specific dispute resolution mechanisms

6. Shariah Compliance: Include when parties specifically require Shariah-compliant structuring

7. Director Resignation: Include when selling shareholder holds board positions that need to be resigned

8. Employee Matters: Include when selling shareholder is also an employee of the company

Suggested Schedules

1. Share Details: Details of shares being redeemed including class, numbers, and distinctive numbers

2. Completion Requirements: Detailed list of documents and actions required for completion

3. Valuation Report: Independent valuation of shares (if applicable)

4. Board and Shareholder Resolutions: Required corporate approvals for the redemption

5. Payment Schedule: If payment is in installments, detailed payment timeline

6. Existing Encumbrances: List of any existing charges or encumbrances on the shares

7. Required Regulatory Approvals: List of necessary government or regulatory approvals

8. Form of Resignation Letter: Template for director resignation letter if applicable

Authors

Alex Denne

Head of Growth (Open Source Law) @ ¶¶Òõ¶ÌÊÓÆµ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

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Relevant Industries

Financial Services

Professional Services

Real Estate

Manufacturing

Technology

Retail

Healthcare

Construction

Hospitality

Energy

Transportation

Media & Entertainment

Education

Trading

Industrial

Relevant Teams

Legal

Finance

Corporate Secretariat

Compliance

Risk Management

Treasury

Corporate Development

Investor Relations

Board Secretariat

Corporate Governance

Relevant Roles

Chief Executive Officer

Chief Financial Officer

General Counsel

Corporate Secretary

Legal Director

Finance Director

Managing Director

Board Member

Compliance Officer

Corporate Governance Officer

Financial Controller

Investment Manager

Risk Manager

Shareholder Relations Manager

Treasury 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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