The advisor must purchase these shares at face value, contrary to the premium rate set after the valuation paid by investors or other buyers (as required by Indian corporate law, each shareholder must purchase all shares at the minimum price of par value). Often, people have the product idea and the framework to start a business, but they are not sure how to proceed. For some aspects, they seek expert advice. Founders can hire an experienced contractor or other expert to guide them. However, they often get stuck when the question arises as to how much equity they should offer to consultants. The consultant`s agreement covers the details of the equity that will be offered to the consultants, as well as the roles they should play and the rights they will have vis-à-vis the company/business. All other details of the consultant`s work with the company must be dealt with as part of such an agreement In order to protect the company and its product, the founders of a company require consultants to enter into confidentiality agreements with the company. This non-extension agreement must be indicated in the advisor`s agreement. In such an agreement, the advisor undertakes not to disclose confidential information of the company to third parties outside the company. He is also obliged to protect the company`s secrets as best he can. In addition, he may also be asked to return to the company certain company documents containing such information after its termination. Indian startups have a lot of questions about how to put consultants` shares, i.e.
actions to consultants, mentors, consultants. First of all, you should know that, in accordance with the provisions of the Companies Act, 2013 and companies (Share Capital & Debentures) Rules, 2014, a private or unlisted public limited company may not issue or transpire shares to consultants and consultants who are not employees or directors of the company, its subsidiaries in India or outside India or its holding company. It is also important to reiterate that Sweat Equity can only be awarded to employees or directors (including self-employed) or promoters of the business, in accordance with section 54 of the Companies Act. A company may issue its shares to consultants and consultants, whether established in India or abroad, if such an expense is approved by a special decision taken at a general meeting. . . .