Most of the first-time entrepreneurs have valid questions and concerns around the Shareholder Agreement ("SHA") in the context of any VC / PE funding. It is a legally binding document and would be the basis for any serious dispute resolution which remains unresolved via mutual deliberations and sometimes even after arbitration [if the SHA provides for arbitration as a dispute resolution mechanism].
Entrepreneurs agree to various covenants when raising VC / PE funds. After execution of the SHA, some of these aspects hardly ever become contentious e.g. Founder's Lock-In, Employment Agreement, Information Rights, Right of First Refusal, Anti-Dilution Protection etc. Not to say "never", but "hardly ever".
Most of the disputes involving the incoming fund investor and the founding team arise from items listed in the what is called "Super-majority" or "Veto" rights of the investor, & more particularly around one or more of the following aspects: Business Strategy, Future Fund Raise amount, timing & attendant terms, Corporate Governance and Exit. Business Strategy encompasses many facets including growth strategy, unit economics, hiring & compensation, change in scope of business (or "pivot") et al. Corporate Governance is much in limelight in recent times given the controversies at Infosys, and hence perhaps needs no further explanation... except to add that there could be acts of clear dishonesty or misrepresentation which can also lead to serious disputes.
When such serious disputes arise, any institutional fund makes every effort to find a workaround via mutual discussions, via interlocutors etc. They extend time windows to allow the founding team / management team a chance to set things right by taking corrective action. The fund teams seriously, seriously resist any arbitration process and completely hate having to go to courts. One might ask: what is their fear? It's largely self interest... they know that Indian judicial system can take forever to give a ruling, and that too can keep getting contested all the way up to the Supreme Court depending on the enormity of what's at stake. They also fear: (a) value erosion for their investment in the company while the legal proceedings take their course; (b) the severe drain on their bandwidth together with the uncertainty of legal expenses bill; & (c) the bad press for the fund and the fund team, which is bad for business overall.
My advice to entrepreneurs - please have a balanced view wrt the SHA. Respect it and abide by the spirit of the SHA. But don't dread it. Finally, it's your word and commitment. As much as fund teams', your future reputation as a credible entrepreneur and dependable business person is equally at stake if you cross the line.