Investor rights

What is Tag-along Right (Co-sale Right)?

Lets minority shareholders 'tag along' on a sale of stock by major shareholders - they sell pro-rata under the same terms.

Tag-along (or co-sale) rights protect minority shareholders from being left behind when major shareholders sell their stock. If a founder sells some of their shares to a private buyer, tag-along lets other shareholders sell a proportional amount under the same terms. This prevents founders from cashing out without offering employees and minor investors the chance to participate.

Related terms

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