Investment and Shareholders Agreement: start-up business multiple investors

When do I use this document?

• for an investment by multiple investors in a start up business
• as a combined subscription and shareholders agreement
• for short form warranties from the company and founders, reflecting the company’s start-up status
• in conjunction with new Articles of Association – for Paper Rock’s accompanying Articles of Association, see Articles of Association – start up business multiple investors
• for investment in a private limited company incorporated in England and Wales

What are the key features?

• full form investment/subscription and shareholders agreement (ISHA)
• 28 clauses and 5 schedules over 36 pages
• subscription: mechanism and terms for the subscription for shares by the investors
• completion: completion of the investment, including the issue of shares to the investors and payment by the investors
• warranties: warranties from the company and each founder
• limitations on liability: limitations on potential liability under the warranties of the company and the founders
• investor rights: exercisable by a majority of the investors
• investor director: investors’ entitlement to appoint a director
• board proceedings: how proceedings of the board will be conducted
• future share issues: pre-emption rights on the issue of new shares
• share transfers: rules governing the transfer of shares, including:
  • pre-emption rights on share transfers
  • compulsory transfer events, including founder good and bad leaver clauses
  • tag-along and drag-along rights
• reserved matters: matters requiring prior approval of the investor majority
• information rights: investors’ rights to information about the company and its finances
• restrictive covenants: restrictions on the founders from competing with the company and soliciting the company’s customers, suppliers and employees

What other documents are available?

For separate documents consisting of a Subscription Agreement and Shareholders Agreement for investment by multiple investors in a start-up business, see

• Subscription Agreement – start up business multiple investors
• Shareholders Agreement – start up business multiple investors

For a combined Investment & Shareholders Agreement for a start-up business with a single investor, see

• Investment and Shareholders Agreement – start up business single investor  

For combined Investment & Shareholders Agreements for an established business, see

• Investment and Shareholders Agreement – established business single investor
• Investment and Shareholders Agreement – established business multiple investors