Shareholders Agreement (SHA)

SHAREHOLDERS AGREEMENT (SHA)

This Agreement is made on [Date] between [Shareholder A] and [Shareholder B]

1. Parties. This Shareholders Agreement is executed between [Shareholder A] and [Shareholder B] (the "Shareholders") and [Company Name], a company incorporated under the Companies Act, 2013 (the "Company").
2. Recitals. The Shareholders hold shares in the Company and wish to record their mutual rights, obligations and the governance of the Company.
3. Shareholding & Consideration. The parties hold shares in the ratio [__:__], and the value/consideration attaching to the equity is Rs. [Amount], effective from [Effective Date].
4. Board & Management. The Board shall comprise [__] directors; each Shareholder holding [__]% or more may nominate [__] director(s), and the quorum shall include such nominee.
5. Reserved Matters. Matters listed in Schedule I (including new issue of capital, borrowings beyond Rs. [__], related-party transactions) shall require the affirmative vote of [__]% of Shareholders.
6. Transfer Restrictions & Obligations. No Shareholder shall transfer shares except in accordance with the right of first refusal, and tag-along and drag-along rights set out herein.
7. Anti-Dilution. The investor Shareholders shall enjoy [broad-based weighted average] anti-dilution protection on any down-round issuance.
8. Representations & Warranties. Each party warrants that it is the legal owner of its shares free of encumbrance and is authorised to enter into this Agreement.
9. Confidentiality. The Shareholders shall keep the Company's information and the terms hereof confidential during and after the term.
10. Exit. The parties shall use best efforts to achieve an exit by way of IPO, strategic sale or buy-back within [__] years from the Effective Date.
11. Term & Termination. This Agreement continues until a Shareholder ceases to hold shares or on unanimous written termination.
12. Governing Law & Jurisdiction. This Agreement is governed by the laws of India, subject to the jurisdiction of courts at [City].
13. Dispute Resolution. Disputes shall be referred to arbitration under the Arbitration and Conciliation Act, 1996, seated at [City], before a [sole/three-member] tribunal.

IN WITNESS WHEREOF the parties have executed this Agreement on the date first written above.