Document background
The Shareholder Transfer Agreement is a fundamental legal instrument used in Indian corporate transactions to document and execute the transfer of company shares between parties. This document becomes necessary when shareholders wish to sell or transfer their shareholding to other parties, whether existing shareholders or new investors. It is particularly important in private companies where shares are not freely transferable. The agreement must comply with Indian corporate law, particularly the Companies Act 2013, SEBI regulations (for listed companies), and relevant tax legislation. It typically includes detailed provisions about the transfer price, payment terms, representations and warranties, and completion mechanics. The document also addresses regulatory requirements, tax implications, and any specific conditions attached to the transfer, making it essential for maintaining clear ownership records and preventing future disputes.
