Shareholders agreement (SHA) generator
A simplified SHA covering reserved matters, ROFR, tag-along, drag-along, board composition, and exit. Definitive document — review with a lawyer before signing.
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Shareholders Agreement
This Shareholders Agreement (the “Agreement”) is made and entered into as of the Effective Date by and between the parties identified herein in relation to {{org_name}} (CIN: {{cin}}), a company incorporated under the laws of India and having its registered office at {{org_address:multi}} (the “Company”).
PROMOTERS:
{{promoters:multi}}
INVESTORS:
{{investors:multi}}
The Promoters and Investors are collectively referred to as the “Shareholders”.
1. Capital Structure. As of the date hereof, the Company’s issued share capital is held as follows:
- Promoters: {{promoter_pct}}
- Investors: {{investor_pct}}
- ESOP / option pool: {{esop_pct}}
2. Board of Directors. The Board shall comprise: {{board}}. The Investors collectively shall have the right to nominate one director (the “Investor Director”) for so long as they collectively hold at least 5% of the Company’s share capital.
3. Reserved Matters. Notwithstanding anything in the Articles, the following actions shall require the affirmative consent of the Investor Director:
{{reserved:multi}}
4. Right of First Refusal. {{rofr}}
5. Tag-along Rights. {{tag}}
6. Drag-along Rights. {{drag}}
7. Liquidation Preference. {{liq}}
8. Anti-dilution Protection. Investors shall benefit from broad-based weighted-average anti-dilution protection for the duration of their shareholding.
9. Promoter Lock-in & Vesting. Promoter shares shall be subject to a four-year monthly vesting schedule with a one-year cliff. Vesting recommences from the Effective Date for the Promoters.
10. Non-Compete & Non-Solicit. The Promoters shall not engage in any business that competes with the Company during their shareholding and for a period of two (2) years thereafter, and shall not solicit Company employees or customers during such period.
11. Information Rights. Investors shall receive (a) monthly management accounts within 15 days of month-end, (b) annual audited financials within 90 days of year-end, and (c) an annual budget within 30 days of the start of each fiscal year.
12. Exit. The parties shall use commercially reasonable efforts to achieve a liquidity event (IPO, strategic acquisition, or secondary sale) within five (5) years of the Effective Date.
13. Dispute Resolution. Any dispute under this Agreement shall be resolved by arbitration under the Arbitration and Conciliation Act, 1996, seated in {{org_address}}.
14. Governing Law. This Agreement shall be governed by the laws of India.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the Effective Date.
For the Company & Promoters
For the Investors