Startup Shareholders Agreement Template for Australia

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Key Requirements PROMPT example:

Startup Shareholders Agreement

"I need a Startup Shareholders Agreement for my fintech company that's taking on seed investment in March 2025, with specific provisions for future funding rounds and protection of our intellectual property rights."

Document background
The Startup Shareholders Agreement is a foundational document for Australian startup companies, typically implemented either at company formation or when taking on initial external investment. This agreement is essential for establishing clear governance structures, protecting shareholder rights, and providing mechanisms for future growth and potential disputes. It addresses key aspects such as share transfer restrictions, pre-emptive rights, board composition, and decision-making processes, all within the framework of Australian corporate law. The agreement is particularly crucial for startups planning to raise capital, as it provides investors with necessary protections while maintaining appropriate controls for founders. It should be tailored to reflect the specific needs of the startup while ensuring compliance with Australian regulatory requirements, including the Corporations Act 2001 and relevant ASIC regulations.
Suggested Sections

1. Parties: Identification of all shareholders and the company

2. Background: Context of the agreement, including company formation and purpose

3. Definitions and Interpretation: Key terms and their meanings used throughout the agreement

4. Share Capital Structure: Details of share classes, rights, and current ownership

5. Shareholders' Rights and Obligations: Core rights and duties of shareholders

6. Board Composition and Governance: Structure and operation of the board of directors

7. Decision Making: Voting rights and procedures for key decisions

8. Share Transfer Restrictions: Limitations and processes for transferring shares

9. Pre-emptive Rights: Existing shareholders' rights to purchase new or transferred shares

10. Tag-Along and Drag-Along Rights: Rights in case of company sale or major share transfers

11. Confidentiality: Protection of company and shareholder confidential information

12. Dispute Resolution: Procedures for handling disagreements between shareholders

13. General Provisions: Standard legal clauses including governing law and amendments

Optional Sections

1. Employee Share Scheme: Framework for issuing shares to employees, used when the startup plans to implement such a scheme

2. Investor Special Rights: Special provisions for major investors, included when there are significant external investors

3. Vesting Provisions: Schedule for founder/employee share vesting, used when implementing vesting arrangements

4. Anti-Dilution Protection: Protection for investors against future down-rounds, included for sophisticated investors

5. Information Rights: Special reporting rights for certain shareholders, used for major investors

6. Non-Compete and Non-Solicit: Restrictions on competitive activities, included when protecting intellectual property is crucial

7. Future Funding Provisions: Framework for future investment rounds, used when planning for future capital raising

8. Exit Strategy Provisions: Specific provisions for IPO or trade sale, included when exit planning is important

Suggested Schedules

1. Share Capital Table: Detailed breakdown of current shareholdings and share classes

2. Deed of Accession: Template for new shareholders to join the agreement

3. Reserved Matters: List of decisions requiring special majority or unanimous approval

4. Company Business Plan: Current business plan and strategic objectives

5. Share Valuation Methodology: Agreed method for valuing shares in various circumstances

6. Key Performance Indicators: Metrics for measuring company and management performance

7. Competing Business List: Defined list of competitors for non-compete provisions

8. Form of Share Transfer Notice: Template for notifying intent to transfer shares

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions
Clauses
Relevant Industries

Technology

Software Development

Biotechnology

Fintech

E-commerce

Healthcare Technology

Clean Technology

Digital Media

Artificial Intelligence

Software as a Service

Manufacturing Innovation

Agtech

Consumer Internet

Deep Technology

Renewable Energy

Relevant Teams

Legal

Finance

Corporate Development

Executive Leadership

Board of Directors

Investment

Compliance

Company Secretariat

Corporate Governance

Strategic Planning

Relevant Roles

Chief Executive Officer

Chief Financial Officer

Company Secretary

General Counsel

Legal Counsel

Corporate Lawyer

Investment Manager

Venture Capital Partner

Startup Founder

Managing Director

Board Director

Chief Operating Officer

Head of Legal

Investment Director

Company Director

Corporate Development Manager

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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