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Venture Partner Agreement Template for United Arab Emirates

A comprehensive legal agreement governed by UAE law that establishes and regulates the relationship between a venture capital firm and a venture partner. The document outlines the terms of engagement, responsibilities, compensation structure, and operational parameters within the UAE's legal framework, including considerations for both mainland UAE and free zone operations. It addresses key aspects such as deal sourcing, investment processes, carried interest arrangements, and compliance with local regulations, while incorporating necessary provisions for UAE-specific requirements including potential Sharia compliance considerations.

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What is a Venture Partner Agreement?

The Venture Partner Agreement is a crucial document used in the UAE's venture capital and private equity landscape to formalize the relationship between investment firms and experienced professionals who serve as venture partners. This agreement is essential when engaging senior investment professionals who may not be full-time employees but play a significant role in deal sourcing, due diligence, and portfolio company management. The document needs to comply with UAE Federal Law No. 32 of 2021 (Commercial Companies Law) and related regulations, while potentially incorporating provisions for free zone operations and Sharia compliance where applicable. It typically includes detailed terms on compensation structures, including carried interest, deal flow responsibilities, confidentiality obligations, and non-compete provisions, all tailored to align with UAE legal requirements and business practices.

What sections should be included in a Venture Partner Agreement?

1. Parties: Identification of the contracting parties - the venture firm and the venture partner

2. Background: Context of the agreement and relationship between the parties

3. Definitions: Key terms used throughout the agreement

4. Appointment and Term: Formal appointment of the venture partner and duration of the agreement

5. Role and Responsibilities: Detailed description of the venture partner's duties and obligations

6. Compensation and Carried Interest: Structure of financial compensation, including base fees, carried interest, and other benefits

7. Deal Flow and Investment Process: Procedures for identifying, evaluating, and presenting investment opportunities

8. Time Commitment and Exclusivity: Expected time dedication and any exclusivity requirements

9. Confidentiality: Protection of confidential information and trade secrets

10. Intellectual Property: Ownership and protection of IP rights developed during the partnership

11. Conflicts of Interest: Procedures for identifying and handling potential conflicts

12. Termination: Grounds and procedures for ending the agreement

13. Post-Termination Obligations: Continuing obligations after the agreement ends

14. Governing Law and Jurisdiction: Applicable UAE laws and jurisdiction for dispute resolution

What sections are optional to include in a Venture Partner Agreement?

1. Non-Compete Provisions: Restrictions on competitive activities, optional based on the firm's requirements and local enforceability

2. Co-Investment Rights: Terms for the venture partner's personal investment in fund deals

3. Performance Metrics: Specific KPIs and performance evaluation criteria

4. Insurance and Indemnification: Professional liability coverage and indemnification terms

5. Marketing and Public Relations: Rules for public representations and use of firm's name

6. Training and Support: Provisions for professional development and support from the firm

7. Compliance with Islamic Finance: Specific provisions ensuring Sharia compliance if required

What schedules should be included in a Venture Partner Agreement?

1. Schedule 1 - Compensation Structure: Detailed breakdown of all compensation elements including carried interest calculations

2. Schedule 2 - Investment Focus Areas: Specific sectors, stages, or geographic areas of investment focus

3. Schedule 3 - Reporting Requirements: Templates and timelines for required reports and documentation

4. Schedule 4 - Approved External Activities: List of pre-approved external business activities or board positions

5. Schedule 5 - Key Performance Indicators: Detailed metrics for performance evaluation

6. Appendix A - Power of Attorney: Scope of authority granted to the venture partner

7. Appendix B - Compliance Procedures: Detailed compliance requirements and procedures

8. Appendix C - Confidentiality Agreement: Detailed non-disclosure terms and requirements

Authors

Alex Denne

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

Publisher

Genie AI

Cost

Free to use

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