Honorary Mentions - ...ย โขย 1y
We've covered dilation and the Board of Directors(BOD). Now, let's delve into Tag-Along RightsโAn Essential Topic Imagine your startup takes off! A major player wants to buy the company, and your majority shareholder is ready to cash in. But what about you, the minority shareholder? Tag-along rights in your SHA ensure you don't get left behind. Here's how it works: โข A major investor decides to sell their controlling interest in the company. โข With tag-along rights, you have the option to sell your shares alongside them at the same price and terms negotiated by the majority shareholder Why are Tag-Along Rights important: โข Liquidity Opportunity: Offers a chance to cash out and secure returns if a major exit opportunity arises. โข Fairness and Transparency: Ensures you're not pressured to sell at a lower price or left holding onto illiquid shares during a majority shareholder exit. Last Post(BOD): https://medial.app/post/662b4609cd3653c2d04cdc67
Honorary Mentions - ...ย โขย 1y
As a founder, your startup is your baby. But what about when that Golden Exit opportunity appears? Drag-Along Rights in your Shareholder Agreement(SHA) are crucial for ensuring a smooth acquisition process. What are Drag-Along Rights? They empower
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Ever seen someone get a wedding invite โ and they bring a plus-one who wasnโt invited but gets all the same perks? Thatโs exactly what Tag Along Rights do for minority shareholders. If the majority is selling their stake to an investor, you โ as a mi
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Transfer Rights Clauses in SHAs from an Investorโs Perspective!! When investing in startups, a well-drafted Shareholders Agreement (SHA) isnโt just a formality, itโs the foundation that protects their financial interests and ensures strategic contro
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Ever been part of a group trip where one person books the tickets โ and everyone else has to follow along, even if they didnโt fully agree? Thatโs pretty much what Drag Along Rights do in the startup world. If a majority shareholder decides to sell
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Last time we discussed dilution in SHAs. Today, we tackle the Board of Directors (BOD)! The BOD: This group oversees your startup's big picture strategy. The SHA defines how many board members there are and how they're chosen. Why it matters: Havin
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