Drag-Along Rights
A contractual provision that enables majority shareholders (or a specified group of shareholders) to force minority shareholders to join in the sale of a company on the same terms and conditions. Drag-along rights prevent minority shareholders from blocking an acquisition or exit that has been approved by the requisite majority. These provisions are standard in venture capital term sheets and shareholder agreements, ensuring that a company can be sold cleanly without holdout problems.
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A contractual provision that protects minority shareholders by giving them the right to join (tag along) in a sale when ...
The legal and contractual entitlements of company owners, including the right to vote on major corporate decisions (such...
Contractual rights that give preferred stockholders (typically investors) the ability to block certain corporate actions...
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