The Founders Collaboration Agreement is a critical document used when two or more parties come together to establish a business venture in the United Arab Emirates. This agreement serves as the cornerstone of the founding relationship, detailing how the business will be operated, funded, and managed. It is particularly important in the UAE context, where business structures must comply with specific local regulations, including the UAE Commercial Companies Law and, where applicable, Free Zone regulations. The document typically includes detailed provisions on capital contributions, profit sharing, management responsibilities, intellectual property rights, and dispute resolution mechanisms. A well-drafted Founders Collaboration Agreement is essential for protecting all parties' interests and ensuring smooth business operations in accordance with UAE law.
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1. Parties: Identification and details of all founding members
2. Background: Context of the collaboration and purpose of the agreement
3. Definitions and Interpretation: Key terms used throughout the agreement and rules of interpretation
4. Business of the Company: Description of the intended business activities and scope
5. Contributions and Shareholding: Details of each founder's initial contributions (capital, assets, services) and resulting shareholding
6. Roles and Responsibilities: Specific duties and responsibilities of each founder
7. Decision Making and Management: Governance structure and decision-making processes
8. Capital and Funding: Initial capital requirements and future funding arrangements
9. Share Transfer Restrictions: Limitations on transfer of shares and right of first refusal provisions
10. Intellectual Property Rights: Ownership and protection of IP created before and during the collaboration
11. Confidentiality: Protection of confidential information and trade secrets
12. Non-Competition and Non-Solicitation: Restrictions on competing activities and poaching of employees/customers
13. Exit Provisions: Procedures for founder exit, including good leaver/bad leaver provisions
14. Dispute Resolution: Process for resolving disagreements between founders
15. Governing Law and Jurisdiction: Specification of UAE law as governing law and jurisdiction
16. General Provisions: Standard boilerplate clauses including notices, amendments, and severability
1. Vesting Provisions: Used when founders' shares are subject to vesting schedules
2. Tag-Along and Drag-Along Rights: Include when planning for future investment or exit scenarios
3. Special Share Classes: Required when creating different classes of shares with varying rights
4. Family Succession Rights: Important in family businesses or when considering inheritance planning
5. Technology Development: Necessary for tech startups with specific development milestones
6. Islamic Finance Compliance: Required when the business needs to comply with Shariah principles
7. Free Zone Specific Provisions: Include when company is established in a UAE Free Zone
8. International Operations: Required when business operations extend beyond UAE
1. Schedule 1 - Business Plan: Detailed business plan including market analysis and financial projections
2. Schedule 2 - Initial Shareholding Structure: Detailed breakdown of share allocation and classes
3. Schedule 3 - Founders' Details: Complete information about founders including contact details and qualifications
4. Schedule 4 - Initial Contributions: Detailed list of each founder's initial contributions (monetary and non-monetary)
5. Schedule 5 - Reserved Matters: List of decisions requiring special majority or unanimous consent
6. Schedule 6 - Key Performance Indicators: Metrics for measuring founder performance and contribution
7. Schedule 7 - Pre-Existing IP: List of intellectual property brought into the business by each founder
8. Schedule 8 - Company Policies: Key operational and governance policies
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