Subscription and Shareholders' Agreement
Contract Template for India

SUBSCRIPTION AND SHAREHOLDERS' AGREEMENT India Date: [date]. Place of signing: [city, State or Union Territory]. Company: [registered name] Private Limited, corporate identity number [number], registered office [address], represented by [authorised signatory and office] (Company). Shareholder A: [full name, residential address and permanent account number], a competent adult individual resident in India. Shareholder B: [full name, residential address and permanent account number], a competent adult individual resident in India. The two individuals are the Shareholders and together own all the Company's currently issued, fully paid ordinary equity shares: A owns [number] and B owns [number]. 1. Rights issue and acceptance The Company has lawfully authorised a rights issue of fully paid ordinary equity shares under section 62(1)(a) of the Companies Act, 2013 and delivered its offer dated [date] to both Shareholders in proportion to their existing holdings, in accordance with its articles. The offer closes on [date]. Under that offer A accepts [number] new shares from A's entitlement and B accepts [number] new shares from B's entitlement (New Shares). Each New Share has face value INR [amount] and issue price INR [amount], including premium INR [amount]. A's total subscription amount is INR [amount] and B's is INR [amount]. Each acceptance is limited to that Shareholder's actual entitlement. The New Shares rank equally with the existing ordinary equity shares from allotment. 2. Payment and allotment Each Shareholder must deliver the signed offer acceptance and pay that Shareholder's subscription amount from their own bank account to [Company account] before the offer closes. Each subscription is independent: a failure by one Shareholder does not forfeit the other's lawful entitlement. Subject to timely acceptance, cleared funds, sufficient authorised capital and all required corporate approvals, the Company must allot each paid entitlement by [date], credit the New Shares to the respective demat account [A details] or [B details], update its register and complete the required return of allotment, stamp-duty and depository steps. Signing or paying does not itself issue shares. If a particular allotment cannot lawfully occur by [long-stop date], the Company must return that Shareholder's subscription amount under mandatory law; the other Shareholder's valid allotment is unaffected. 3. Shareholder decisions and funds From signing, each Shareholder agrees to withhold their vote from a voluntary issue of further shares outside statutory rights, an alteration of the rights of the ordinary shares, or a sale of substantially all the Company's business unless both Shareholders consent in writing. The Company must use the subscription proceeds for [specific business purpose], unless both Shareholders consent to another lawful corporate purpose. The board retains its statutory powers and duties, and all required board, shareholder and regulatory approvals remain necessary. Nothing here requires a director to breach a duty or prevents an act required by law. 4. Articles and duration The Shareholders must use their lawful votes to place the decision rule in clause 3 into the Company's articles, and the Company must make the required filings. This agreement does not itself amend the articles or override the Companies Act, 2013. Until a necessary amendment takes effect, the parties remain bound by their lawful personal promises, while the Company acts under its existing articles and mandatory law. Clause 3 binds a Shareholder only while that person holds Company shares; a transferee is not bound without signing an accession. The parties may end clause 3 by their joint written agreement, subject to accrued rights. 5. Law The parties must have this agreement duly stamped as required in the State or Union Territory where it is executed. Indian law governs this agreement. Courts at [city, State or Union Territory] have jurisdiction, subject to mandatory law. For the Company: ____________________ Name and office: [details] Date: [date] Shareholder A signature: ____________________ Date: [date] Shareholder B signature: ____________________ Date: [date]