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Shareholder Agreements
Expert SHA drafting and partnership deed services for businesses
What is a Shareholder Agreement?
📌 Overview
A Shareholder Agreement (SHA) is a legally binding contract between shareholders that defines their rights, obligations, and relationships. It complements the Articles of Association and provides additional protections for shareholders.
✅ Key Services
SHA drafting and review, partnership deed drafting, buy-sell arrangements, right of first refusal (ROFR), tag-along rights, drag-along rights, anti-dilution provisions, dispute resolution mechanisms.
⚖️ Legal Framework
Shareholder agreements are governed by the Companies Act, 2013, Indian Contract Act, 1872, and SEBI regulations. Key sections include 58 (Share transfer), 56 (Share transfer restrictions), and 166 (Shareholder rights).
Important FAQs
❓ What is the difference between SHA and AoA?
SHA is a private contract between shareholders, while Articles of Association (AoA) is a public document filed with ROC. SHA can contain provisions not in AoA and provides additional shareholder protections.
❓ What are tag-along and drag-along rights?
Tag-along rights allow minority shareholders to sell their shares if a majority shareholder sells (protecting minority). Drag-along rights allow majority shareholders to force minority to sell (facilitating exit).
❓ Is SHA mandatory for startups?
While not mandatory, SHA is highly recommended for startups, especially those with multiple co-founders or seeking investor funding to avoid future disputes.
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