Term of the Day:

drag-along rights

noun

A shareholder right that enables a majority shareholder to force a minority shareholder to join the sale of a company. The majority shareholder must give the same price and terms to the minority shareholder that is being "dragged along."

Example: Despite the fact that Jim did not want to sell his shares, the VC's drag along rights ensured that Google could buy 100% of the startup.

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