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An Operating Agreement sets the ground rules for how a limited liability company (LLC) runs in Saudi Arabia. It spells out how owners make decisions, share profits, and handle day-to-day operations. Think of it as your company's internal playbook, required under the Saudi Companies Law.

Beyond just meeting legal requirements, this agreement protects business owners by clearly defining roles, responsibilities, and ownership stakes. It covers key areas like capital contributions, management structure, and procedures for adding or removing members - helping prevent disputes and keeping operations smooth. Saudi LLCs must align their Operating Agreements with Shariah principles and local commercial regulations.

Create an Operating Agreement when forming your LLC in Saudi Arabia - it's a crucial first step that saves headaches later. This document becomes especially important when bringing on new business partners, seeking financing, or expanding operations across multiple locations in the Kingdom.

Use it to set clear expectations during major business changes like ownership transfers, profit distribution updates, or management restructuring. The agreement helps navigate complex situations like member disputes or succession planning. Having these rules documented upfront, in line with Saudi commercial laws and Shariah principles, prevents costly conflicts and keeps your business running smoothly.

• Limited Liability Company Agreement: Basic foundation agreement for standard LLCs, covering essential governance and ownership structures
• Multi Member Operating Agreement: Specifically designed for LLCs with multiple owners, detailing voting rights and profit sharing
• Amended Operating Agreement: Updates existing agreements when business structure or member roles change
• Business Partnership Operating Agreement: Tailored for joint ventures and strategic partnerships under Saudi commercial law
• Operations Transfer Agreement: Specialized version for transferring business operations between entities

• LLC Members/Owners: Primary stakeholders who sign and follow the Operating Agreement, contributing capital and sharing profits according to agreed terms
• Company Managers: Execute day-to-day operations and make decisions within the framework set by the agreement
• Legal Counsel: Draft and review agreements to ensure compliance with Saudi Companies Law and Shariah principles
• Ministry of Commerce Officials: Review Operating Agreements during company registration and major amendments
• Financial Officers: Implement profit-sharing and capital contribution arrangements outlined in the agreement
• Business Partners: External parties who need to understand company structure and decision-making processes

• Company Details: Gather full legal names, addresses, and ownership percentages of all LLC members
• Capital Structure: Document initial investments, contribution schedules, and profit-sharing ratios
• Management Setup: Define roles, voting rights, and decision-making processes for day-to-day operations
• Business Purpose: Specify permitted activities aligned with Saudi commercial regulations
• Exit Strategy: Plan procedures for member withdrawal, transfers, or company dissolution
• Compliance Check: Review Shariah compliance requirements and Ministry of Commerce guidelines
• Document Generation: Use our platform to create a legally-sound Operating Agreement tailored to Saudi regulations

• Company Information: Full legal name, registration number, and principal office location in Saudi Arabia
• Member Details: Names, identification numbers, and ownership percentages of all LLC members
• Capital Structure: Initial capital amounts, contribution schedules, and profit distribution formulas
• Management Rights: Decision-making authority, voting procedures, and quorum requirements
• Shariah Compliance: Statements ensuring business activities align with Islamic principles
• Transfer Provisions: Rules for selling ownership stakes and admitting new members
• Dispute Resolution: Saudi arbitration procedures and jurisdiction specifications
• Dissolution Terms: Process for winding up operations and distributing assets

An Operating Agreement differs significantly from a Business Acquisition Agreement in Saudi Arabia. While both are crucial business documents, they serve distinct purposes in commercial relationships.

• Purpose and Timing: Operating Agreements govern ongoing internal LLC operations, while Business Acquisition Agreement handles one-time business purchases or mergers
• Scope of Coverage: Operating Agreements detail day-to-day management, profit sharing, and member rights. Acquisition Agreements focus on purchase terms, asset transfers, and transition arrangements
• Duration: Operating Agreements remain active throughout company existence, while Acquisition Agreements typically conclude once the purchase is complete
• Parties Involved: Operating Agreements bind LLC members internally, whereas Acquisition Agreements involve separate buyer and seller entities
• Regulatory Framework: Operating Agreements follow Saudi Companies Law for ongoing operations, while Acquisition Agreements align with merger and acquisition regulations