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Shareholder's Agreement

Shareholder’s Agreement (SHA) is an agreement that is entered into between the shareholders of the company and the company itself. This governs the relationship between the shareholders of the company.

People purchased

243 People purchased

4.4 LegalKart reviews and ratings
Shareholder's Agreement

Shareholder’s Agreement (SHA) is an agreement that is entered into between the shareholders of the company and the company itself. This governs the relationship between the shareholders of the company.

LegalKart reviews and ratings LegalKart reviews and ratings LegalKart reviews and ratings LegalKart reviews and ratings LegalKart reviews and ratings 4.4 / 5 ( 122 Reviews)
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243 People purchased

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SHAREHOLDER'S AGREEMENT

As the name suggests, a Shareholder’s Agreement (SHA) is an agreement that is entered into between the shareholders of the company and the company itself. This governs the relationship between the shareholders of the company inter se.

For example, If B, has become a new shareholder of company X, a Shareholder’s Agreement (SHA) will be entered into company X, B and rest of the shareholders of company X.

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Contents of Shareholder's Agreement

The following clauses form part of a well drafted SHA:-

  • Type of security issued/purchased

  • Conversation rate of convertible securities

  • Veto rights

  • Founder’s lock-in

  • Drag along

  • Tag along

  • Right of first refusal (ROFR)

  • Right of first offer (ROFO)

  • Reps & Warranties

  • Exit rights

  • Governing law and Dispute Resolution 

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Deliverables

Our standard deliverables for every document drafting includes:

  • 60 Minutes of Talk-Time with the Lawyer for drafting/reviewing the Agreement

 

  • First draft of the documents will be delivered to you within a maximum of 2 working days

 

  • Post-delivery of the first draft – Iterations in the master Document to incorporate your suggestions/changes

Laws governing the Shareholder's Agreement in India

The different laws which govern various aspects of Shareholder's Agreement in India are as follows:

  • Companies Act, 2013 and various rules framed thereunder
  • The Indian Contract Act, 1872
  • Foreign Exchange Management Act, 1999
  • Consolidated FDI Policy, 2020
  • RBI Policies
  • Competition Act, 2002
  • SEBI Guidelines (in case of listed company)

Why LegalKart?

  • Senior Corporate Expert Lawyers: We will get your document drafted/reviewed by Senior Expert Corporate lawyers. You can track the progress of your document on our platform at all times.
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  • Responsible Delivery: Our team of experienced business advisors are just a phone call away. Our team will ensure that your interaction with the expert lawyer is smooth and seamless and the document draft is delivered to you within the committed timeline.

Agreeements & Contracts

Shareholder's Agreement

₹12499

₹ 24999 (50% Off) ₹12499 Save

Gross Total

₹12499

Deliverables *

a) Detailed call with Startup Expert Lawyer to understand your company structure. b) Detailed drafting of the Share Holder's agreement. c) Call with Key Shareholders to explain them the key clauses. d) Final Draft of the shareholder's agreement delivered within 5 working days. e) Two iteration shall be included in this if there are any feedbacks post finalising the document.

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Frequently Asked Question

How do you use Shareholder’s Agreement?

Whenever you are entering into any investment transaction where you are purchasing the shares of a company (either through buying shares through existing shareholders or subscribing to new shares), you should enter into an agreement called SHA. 

 

In order to give effect to the terms of SHA, amendment to the Articles of Association (AoA) post investment,  is pertinent.

What is the importance of Shareholder’s Agreement?

A Shareholder's Agreement (SHA) is an agreement that governs the rights and obligations of the shareholders of the company inter se. All your important rights in a company, such as type of securities, conversion rate of convertible securities, veto rights, anti-dilution rights, right of first refusal (ROFR), right of first offer (ROFO), drag along rights, tag along rights, other exit rights, etc. are all mentioned in the SHA.

What is the difference between Shareholders Agreement, Share Subscription Agreement and Share Purchase Agreement?

A Shareholders Agreement (SHA) is an agreement that governs the relationship between the shareholders inter se. It enumerated the important rights and obligations of the shareholders.

 

A Share Subscription Agreement (SSA) is an agreement between a new investor and the company by which the company issues fresh securities to the investor. 

 

A Share Purchase Agreement (SPA) is an agreement that is entered into between a new investor and an existing (or exiting) investor. By the virtue of SPA, the existing investor transfers the whole or a part of its shareholding in favour of the new investor. 

 

In contrast therefore, in an SSA, new securities are being issued to the investor and in case of SPA, an existing investor is transferring his shareholdings to the new investor. The company is just a passive party in case of SPA. However, in SSA, the company is the active party. A SHA, on the other hand, is entered into either case, i.e. whether new security is being issued or the security is being transferred.

What our users have to say

4.4 LegalKart reviews and ratings
Shareholder's Agreement

Shareholder’s Agreement (SHA) is an agreement that is entered into between the shareholders of the company and the company itself. This governs the relationship between the shareholders of the company.

LegalKart reviews and ratings LegalKart reviews and ratings LegalKart reviews and ratings LegalKart reviews and ratings LegalKart reviews and ratings 4.4 / 5 ( 122 Reviews)
People purchased

243 People purchased

Agreeements & Contracts

Shareholder's Agreement

₹12499

₹ 24999 (50% Off) ₹12499 Save

Gross Total

₹12499

Deliverables *

a) Detailed call with Startup Expert Lawyer to understand your company structure. b) Detailed drafting of the Share Holder's agreement. c) Call with Key Shareholders to explain them the key clauses. d) Final Draft of the shareholder's agreement delivered within 5 working days. e) Two iteration shall be included in this if there are any feedbacks post finalising the document.

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We Accept

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