Document background
Share Retention Agreements are crucial instruments in Saudi Arabian corporate practice, used to maintain stability in company ownership and protect stakeholder interests. These agreements are particularly relevant during initial public offerings, corporate restructurings, or when implementing succession planning in family businesses. The document must comply with Saudi Companies Law, Capital Market Authority regulations, and Sharia principles. A Share Retention Agreement typically specifies the lock-up period, details permitted and restricted transfers, and outlines enforcement mechanisms. It's commonly used in scenarios such as post-IPO lock-ups, joint venture arrangements, or when maintaining specific ownership structures is critical for business operations or regulatory compliance. The agreement's terms must be carefully crafted to balance shareholder rights with company interests while ensuring enforceability under Saudi Arabian law.
