Shareholder Confidentiality Agreement for India

Shareholder Confidentiality Agreement Template for India

A comprehensive legal document governed by Indian law that establishes confidentiality obligations between a company and its shareholders, ensuring the protection of sensitive business information shared during the course of the shareholding relationship. The agreement complies with the Indian Companies Act 2013, Securities and Exchange Board of India (SEBI) regulations, and relevant provisions of the Indian Contract Act 1872, while incorporating specific measures for protecting trade secrets, intellectual property, and other confidential business information. It outlines the scope of confidential information, usage restrictions, security measures, and consequences of breach.

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What is a Shareholder Confidentiality Agreement?

The Shareholder Confidentiality Agreement is essential for companies operating in India who need to share sensitive business information with their shareholders while maintaining information security and legal compliance. This document becomes particularly important during corporate actions, strategic planning, or when shareholders require access to non-public information. It ensures compliance with Indian corporate law requirements, including the Companies Act 2013 and SEBI regulations, while protecting the company's intellectual property and trade secrets. The agreement typically covers various types of confidential information including financial data, business strategies, technical information, and customer data, establishing clear guidelines for information handling, permitted uses, and consequences of unauthorized disclosure.

What sections should be included in a Shareholder Confidentiality Agreement?

1. Parties: Identification of the company and the shareholder(s) entering into the agreement

2. Background: Context of the agreement, including the shareholder's relationship with the company and the need for confidentiality

3. Definitions: Detailed definitions of key terms including 'Confidential Information', 'Permitted Purpose', 'Authorized Representatives', etc.

4. Scope of Confidential Information: Detailed description of what constitutes confidential information under the agreement

5. Confidentiality Obligations: Core obligations regarding the protection and non-disclosure of confidential information

6. Permitted Uses: Specific circumstances under which the confidential information may be used

7. Security Measures: Required procedures and safeguards for protecting confidential information

8. Return or Destruction of Confidential Information: Obligations regarding the handling of confidential information upon termination or request

9. Duration and Survival: Term of the agreement and which obligations survive termination

10. Breach and Remedies: Consequences of breach and available remedies including injunctive relief

11. General Provisions: Standard clauses including governing law, jurisdiction, entire agreement, etc.

What sections are optional to include in a Shareholder Confidentiality Agreement?

1. Third Party Disclosure: Additional provisions for cases where disclosure to third parties (like advisors or affiliates) may be necessary

2. Special Categories of Information: Additional provisions for particularly sensitive information like trade secrets or personal data

3. International Transfer of Information: Required when confidential information may be transferred across borders

4. Competition and Non-Solicitation: Additional restrictions on competitive activities, if relevant to the shareholding relationship

5. Insider Trading Prevention: Special provisions for listed companies to prevent insider trading

6. Digital Security Measures: Specific provisions for protecting digital information and cybersecurity measures

What schedules should be included in a Shareholder Confidentiality Agreement?

1. Schedule 1 - Categories of Confidential Information: Detailed list of types of confidential information covered by the agreement

2. Schedule 2 - Authorized Representatives: List of individuals authorized to access confidential information

3. Schedule 3 - Security Protocols: Detailed security procedures and requirements

4. Appendix A - Form of Confidentiality Undertaking: Template undertaking to be signed by authorized representatives

5. Appendix B - Data Handling Procedures: Specific procedures for handling different types of confidential information

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

Jurisdiction

India

Publisher

Genie AI

Cost

Free to use
Relevant legal definitions
Relevant Industries

Technology

Financial Services

Manufacturing

Healthcare

Pharmaceuticals

Real Estate

Energy

Telecommunications

Professional Services

E-commerce

Media & Entertainment

Education

Retail

Automotive

Infrastructure

Relevant Teams

Legal

Corporate Secretarial

Compliance

Board of Directors

Corporate Governance

Investor Relations

Risk Management

Corporate Communications

Executive Leadership

Corporate Affairs

Relevant Roles

Chief Executive Officer

Chief Financial Officer

Company Secretary

Legal Counsel

Corporate Lawyer

Compliance Officer

Board Director

Chief Legal Officer

Investment Manager

Corporate Governance Officer

Shareholder Relations Manager

Chief Operating Officer

Chief Strategy Officer

Risk Manager

Corporate Communications 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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