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A shareholders agreement is a legal document that outlines the rights and responsibilities of shareholders in a company. It is a crucial document that is drawn up to ensure that the interests of all shareholders are protected and that the company is run in a fair and equitable manner. The Companies Act of 2013 lays down the rules and regulations governing shareholders agreements in India.

Under the Companies Act of 2013, a shareholders agreement can be entered into between the shareholders of a company. The agreement can be entered into at any time – either before or after the company is incorporated. However, it is important to note that a shareholders agreement cannot take precedence over the company`s Articles of Association or the provisions of the Companies Act.

The agreement typically covers a wide range of topics such as the appointment of directors, the transfer of shares, the distribution of profits, and the management of the company. It also sets out the procedures to be followed in the event of disputes between shareholders.

One of the key provisions of a shareholders agreement is the right of first refusal. This clause stipulates that if a shareholder wishes to sell their shares, they must first offer them to the other shareholders before selling them to an external party. This ensures that the existing shareholders have the opportunity to maintain their ownership stake in the company.

Another important provision is the tag-along right. This clause gives minority shareholders the right to sell their shares on the same terms as the majority shareholder if the majority shareholder decides to sell his/her shares to a third party.

The drag-along right is a corresponding provision that is designed to protect majority shareholders. This clause gives the majority shareholder the right to force minority shareholders to sell their shares along with the majority shareholder if a third party wishes to buy the entire company.

It is important to note that a shareholders agreement is a private document that is not filed with the Registrar of Companies. However, it is a legally binding agreement that is enforceable in a court of law. It is therefore crucial to ensure that the agreement is drafted carefully and that all parties are fully aware of its contents.

In conclusion, a shareholders agreement is an essential document that helps ensure fair and equitable management of a company. Under the Companies Act of 2013, shareholders agreements can be entered into at any time and cover a wide range of topics. It is important to ensure that the agreement is carefully drafted and that all parties are fully aware of its contents.