The Exclusive Subcontractor Agreement is a specialized contract used in Saudi Arabia when a main contractor wishes to establish a sole subcontracting relationship for specific services or works. This document is particularly important in sectors requiring specialized expertise or in situations where exclusivity provides strategic advantages. The agreement must comply with Saudi Arabian law, including the Commercial Courts Law, Labor Law, and relevant sector-specific regulations. It typically includes comprehensive provisions covering scope of work, commercial terms, performance standards, and compliance requirements. The document is structured to protect both parties' interests while ensuring adherence to Shariah principles and local business practices. This type of agreement is commonly used in major projects where the main contractor needs to secure dedicated subcontractor capacity or expertise.
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1. Parties: Identification of the main contractor and subcontractor, including full legal names, commercial registration numbers, and authorized representatives
2. Background: Context of the agreement, relationship between parties, and general purpose of the exclusive arrangement
3. Definitions: Key terms used throughout the agreement, including technical terms, project-specific terminology, and legal definitions
4. Scope of Exclusivity: Clear definition of the exclusive rights granted, territorial scope, and any limitations
5. Scope of Works: Detailed description of services/works to be performed by the subcontractor
6. Term and Renewal: Duration of the agreement, commencement date, and renewal provisions
7. Subcontractor Obligations: Key responsibilities, performance standards, and deliverables
8. Main Contractor Obligations: Support, information, and resources to be provided by the main contractor
9. Commercial Terms: Pricing, payment terms, invoicing procedures compliant with Saudi law and Shariah principles
10. Performance Monitoring: KPIs, reporting requirements, and performance review processes
11. Compliance Requirements: Obligations to comply with Saudi laws, regulations, and industry standards
12. Confidentiality: Protection of confidential information and trade secrets
13. Intellectual Property: Ownership and usage rights of IP created during the agreement
14. Liability and Indemnification: Risk allocation, limitation of liability, and indemnification provisions
15. Force Majeure: Events beyond parties' control and their consequences
16. Termination: Grounds for termination, notice requirements, and consequences
17. Dispute Resolution: Process for resolving disputes under Saudi law, including jurisdiction and governing law
18. General Provisions: Standard boilerplate clauses adapted to Saudi law requirements
1. Insurance: Detailed insurance requirements - include if specific insurance coverage is needed for the services
2. Bank Guarantees: Requirements for performance bonds or other financial securities - include for high-value contracts
3. Health and Safety: Specific HSE requirements - include for construction or industrial services
4. Security Requirements: Special security measures - include for sensitive or government-related projects
5. Environmental Compliance: Environmental protection measures - include for environmentally sensitive work
6. Local Content Requirements: Saudi workforce and local content obligations - include if subject to Saudization requirements
7. Training and Knowledge Transfer: Requirements for training local staff - include if technology transfer is involved
8. Quality Assurance: Specific quality standards and certifications - include for technical or specialized services
1. Schedule 1 - Scope of Works: Detailed technical specifications and requirements
2. Schedule 2 - Commercial Terms: Detailed pricing, payment terms, and commercial conditions
3. Schedule 3 - Performance Standards: KPIs, service levels, and performance measurement criteria
4. Schedule 4 - Required Permits and Licenses: List of regulatory approvals needed for performance
5. Schedule 5 - Form of Performance Bond: Template for any required bank guarantees
6. Schedule 6 - HSE Requirements: Detailed health, safety, and environmental standards
7. Schedule 7 - Required Insurance: Specific insurance types and coverage levels
8. Schedule 8 - Key Personnel: List of key staff and their qualifications
9. Appendix A - Required Forms and Templates: Standard forms for reports, invoices, and notices
10. Appendix B - Site Access Procedures: Procedures for accessing work sites or facilities
Relevant legal definitions
Clauses
Relevant Industries
Construction
Oil & Gas
Infrastructure
Manufacturing
Technology
Defense
Healthcare
Telecommunications
Engineering Services
Facilities Management
Mining
Energy
Transportation
Relevant Teams
Legal
Procurement
Operations
Commercial
Finance
Risk & Compliance
Project Management
Supply Chain
Business Development
Technical
Relevant Roles
Contract Manager
Legal Counsel
Project Director
Commercial Manager
Procurement Manager
Operations Director
Chief Financial Officer
Risk Manager
Compliance Officer
Business Development Manager
Technical Director
Project Manager
Supply Chain Manager
General Counsel
Chief Executive Officer
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