Call And Put Option Agreement Template for India

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Key Requirements PROMPT example:

Call And Put Option Agreement

"I need a Call and Put Option Agreement for a tech startup investment where our VC firm will have the right to purchase additional shares at a pre-determined valuation until March 2025, while the founders will have the right to sell their shares back to us if certain revenue targets aren't met."

Document background
The Call And Put Option Agreement serves as a critical instrument in Indian business and investment transactions, providing parties with predetermined rights to buy and sell assets or securities under specific conditions. This document is particularly valuable in joint ventures, private equity investments, and strategic partnerships where parties require clear exit mechanisms or future purchase rights. The agreement must comply with Indian regulatory requirements, including SEBI regulations, the Securities Contracts (Regulation) Act, and the Companies Act, 2013. It typically includes detailed provisions on exercise prices, timelines, procedures, and settlement mechanisms, while addressing specific Indian legal considerations such as stamp duty requirements and foreign exchange regulations where applicable. The document is essential for protecting parties' interests and ensuring smooth execution of future transactions in accordance with Indian law.
Suggested Sections

1. Parties: Identifies and defines the parties to the agreement - typically the option holder(s) and option grantor(s)

2. Background: Sets out the context and purpose of the agreement, including details about the underlying assets

3. Definitions and Interpretation: Defines key terms used throughout the agreement and establishes interpretation rules

4. Grant of Options: Explicitly states the grant of call and put options and their basic terms

5. Option Exercise Price: Specifies the price(s) at which the options can be exercised and any adjustment mechanisms

6. Exercise Period: Defines when the options can be exercised, including commencement and expiration dates

7. Exercise Procedure: Details the process and requirements for exercising the options

8. Settlement Terms: Specifies how the transaction will be settled upon exercise (cash or physical settlement)

9. Representations and Warranties: Standard and specific warranties from each party

10. Covenants: Ongoing obligations of the parties during the option period

11. Events of Default: Specifies what constitutes default and consequences

12. Termination: Circumstances under which the agreement can be terminated and the consequences

13. Notices: Communication requirements and contact details

14. Governing Law and Jurisdiction: Specifies Indian law as governing law and relevant jurisdiction for disputes

15. General Provisions: Standard boilerplate clauses including assignment, amendments, entire agreement, etc.

Optional Sections

1. Regulatory Compliance: Required when dealing with regulated entities or when specific regulatory requirements apply

2. Foreign Exchange Provisions: Required when the agreement involves cross-border elements or foreign parties

3. Tag-Along Rights: Optional provisions for co-sale rights in case of share options

4. Drag-Along Rights: Optional provisions for forced sale in case of share options

5. Valuation Mechanism: Required when the exercise price is not fixed but requires future valuation

6. Anti-dilution Provisions: Required for share options to protect against dilution of shareholding

7. Tax Provisions: Detailed tax clauses required when specific tax implications need to be addressed

8. Right of First Refusal: Optional provisions giving priority rights for purchase of options or underlying assets

Suggested Schedules

1. Schedule 1 - Option Terms: Detailed terms of the call and put options including precise exercise prices and periods

2. Schedule 2 - Underlying Assets: Detailed description of the assets subject to the options

3. Schedule 3 - Exercise Notice Format: Template for the option exercise notice

4. Schedule 4 - Warranties: Detailed warranties specific to the underlying assets

5. Schedule 5 - Completion Requirements: Detailed requirements for completing the transfer upon exercise

6. Appendix A - Board Resolutions: Copies of relevant board resolutions authorizing the agreement

7. Appendix B - Valuation Methodology: Detailed methodology for calculating asset value if applicable

8. Appendix C - Regulatory Approvals: Copies of relevant regulatory approvals or requirements

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

Financial Services

Private Equity

Venture Capital

Investment Banking

Real Estate

Technology

Manufacturing

Retail

Healthcare

Infrastructure

Energy

Telecommunications

Professional Services

Mining and Natural Resources

Relevant Teams

Legal

Finance

Corporate Development

Investment

Compliance

Risk Management

Treasury

Corporate Secretarial

Business Development

Executive Leadership

Mergers and Acquisitions

Relevant Roles

Chief Executive Officer

Chief Financial Officer

Chief Legal Officer

Investment Director

Corporate Lawyer

Legal Counsel

Investment Manager

Corporate Finance Manager

Business Development Director

Financial Controller

Company Secretary

Risk Manager

Compliance Officer

Managing Director

Private Equity Partner

Corporate Development Manager

Transaction Advisory 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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