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Startup Shareholders Agreement Template for Malaysia

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Key Requirements PROMPT example:

Startup Shareholders Agreement

"I need a Startup Shareholders Agreement for my Malaysian technology startup with three co-founders, where we're bringing in a venture capital investor who will take a 20% stake in January 2025; the agreement needs to include strong anti-dilution provisions and specific clauses about technology IP ownership."

Document background
The Startup Shareholders Agreement is a vital legal document used when establishing or formalizing the relationship between shareholders in a Malaysian startup company. It becomes particularly relevant when a startup is incorporating, raising capital, or bringing in new investors. The agreement, governed by Malaysian law and compliant with the Companies Act 2016, sets out detailed provisions for company governance, share ownership, voting rights, share transfer restrictions, and exit mechanisms. This document is essential for protecting both founders' and investors' interests, preventing potential disputes, and providing clear guidelines for company operations and decision-making. The agreement typically includes provisions for future funding rounds, anti-dilution protection, and mechanisms for resolving deadlocks or disputes, making it a crucial foundation document for any Malaysian startup's corporate governance structure.
Suggested Sections

1. Parties: Identification of all shareholders and the company as parties to the agreement

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

3. Definitions and Interpretation: Definitions of key terms and interpretation rules for the agreement

4. Share Capital and Shareholding: Details of company's share capital structure and shareholding percentages

5. Shareholders' Rights and Obligations: Core rights and obligations of shareholders, including voting rights and capital contribution requirements

6. Management and Board Matters: Governance structure, board composition, and decision-making processes

7. Transfer of Shares: Rules and restrictions regarding share transfers, including right of first refusal and tag-along rights

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

9. Dividend Policy: Rules and principles governing dividend declarations and distributions

10. Confidentiality: Obligations regarding confidential information and trade secrets

11. Non-Competition and Non-Solicitation: Restrictions on competitive activities and employee/customer solicitation

12. Default and Remedies: Consequences of breaching the agreement and available remedies

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

14. General Provisions: Standard legal provisions including notices, amendments, governing law, and dispute resolution

Optional Sections

1. Preference Share Rights: Details of special rights attached to preference shares, used when the company has or plans to issue preference shares

2. Founder Commitments: Specific obligations and commitments of founders, including time commitment and intellectual property assignment

3. Employee Share Scheme: Framework for employee share ownership, included when the company has or plans to implement an ESOS

4. Intellectual Property Rights: Detailed provisions regarding IP ownership and protection, especially important for technology startups

5. Anti-Dilution Protection: Provisions protecting investors from dilution in future funding rounds, included when requested by investors

6. Dead-lock Resolution: Specific procedures for resolving shareholder deadlocks, important for 50-50 ownership structures

7. Tag-Along and Drag-Along Rights: Detailed provisions for co-sale rights and forced sale scenarios, important for venture-backed startups

8. Put and Call Options: Specific share purchase options, included when shareholders want predetermined exit mechanisms

Suggested Schedules

1. Schedule 1: Company Information: Detailed company information including registration details, share capital structure, and current shareholders

2. Schedule 2: Initial Business Plan: Company's business plan and financial projections

3. Schedule 3: Reserved Matters List: Comprehensive list of matters requiring special approval

4. Schedule 4: Share Transfer Procedures: Detailed procedures and forms for share transfers

5. Schedule 5: Deed of Adherence: Template deed for new shareholders to join the agreement

6. Schedule 6: Fair Value Calculation: Methodology for calculating share fair value for transfers or exits

7. Schedule 7: Key Performance Indicators: Specific performance metrics for founder/management evaluation

8. Appendix A: Share Capital History: Historical record of share issuances and transfers

9. Appendix B: Board Resolutions: Template board resolutions for common corporate actions

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok³ÉÈ˰æ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions














































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Relevant Industries

Technology

E-commerce

Financial Technology

Healthcare Technology

Education Technology

Software Development

Biotechnology

Clean Technology

Digital Services

Manufacturing

Retail Innovation

Agricultural Technology

Artificial Intelligence

Internet of Things

Mobile Applications

Relevant Teams

Legal

Corporate Secretarial

Board of Directors

Executive Management

Investment

Corporate Development

Compliance

Finance

Corporate Affairs

Business Development

Relevant Roles

Chief Executive Officer

Chief Financial Officer

Chief Legal Officer

Company Secretary

Corporate Lawyer

Investment Manager

Venture Capital Partner

Startup Founder

Managing Director

Board Member

Legal Counsel

Corporate Affairs Manager

Business Development Director

Compliance Officer

Company Director

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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