Negate sentence in the Tag-Along Agreement effortlessly

Aug 6th, 2022
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How to Negate sentence in the Tag-Along Agreement

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hi im matt crowley this particular webinar is going to be on tag along and dragged along rights this will be a short one but it will be pretty important so for shareholders that are entering it either a buy sell agreement or perhaps an investor rights agreement or just an agreement among their co-founders on how theyre going to treat each other its important to consider how to handle situations where youre either in the minority or youre in the majority in terms of the number of shares you have when you think about the exit so when Ive talked about the exit Im not thinking about the companies going public Im thinking about someone acquiring your company most of the time the acquire is going to buy the assets of your company thats the reality but in the event that you managed to sell you the company and the buyer wants to buy the stock or the membership interests whatever form of equity you have if Im a shareholder in your company and I only own a third of the shares one of t

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Disadvantages of the right to tag along Moreover, tag along rights also affect the sale of the company when the potential buyer is reluctant to change the terms and conditions of the sale transaction to please the minority shareholder and is unwilling to buy their shares.
A drag along clause can force minority shareholders to sell their shares when the company is being sold. A tag along clause gives minority shareholders the right to seek a sale for themselves under the same terms with the same buyer when a majority shareholder is selling their portion of shares.
A come-along clause, also referred to as drag-along rights, force minority shareholders to sell their shares when majority shareholders decide to sell theirs. A come-along clause is essentially the opposite of tag-along rights.
For example, a majority shareholder who holds 75% of the shares in the company who agrees to sell their shares in a share sale to a potential buyer, must offer the same price for the shares to the minority shareholders if they want to drag them along.
A drag-along right is a provision or clause in an agreement that enables a majority shareholder to force a minority shareholder to join in the sale of a company. The majority owner doing the dragging must give the minority shareholder the same price, terms, and conditions as any other seller.
Also known as piggyback rights and co-sale rights, tag-along rights are the right to participate in another persons negotiated sale of its equity. They enable certain equity holders to force a selling equity holder to include their equity in the sale on a pro rata basis.
A tag along clause gives minority shareholders the right to seek a sale for themselves under the same terms with the same buyer when a majority shareholder is selling their portion of shares.
Co-sale rights, also known as tag-along or (less often) take-me-along rights, are the rights of minority shareholders to join in when the majority shareholder or the founders sell their stock.

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