🚜Drag / Tag Along

Function and Usage

Drag-along term refers to the right holder compels the obligor to follow him/her in transferring a specific number or percentage of shares to a specific buyer on the same terms and conditions, if the triggering conditions are fulfilled. Tag-Along term refers to the right holder is obliged to follow the seller of the share interest to transfer a specific amount or a specific percentage of share interest to a specific buyer under the same terms and conditions, if the triggering conditions are fulfilled. In the event that the right holder exercises the right, the buyer of the original transaction may choose to accept both the drag-along and tag-along arrangements, and thus buy the underlying shares, otherwise, all the other transactions will not be settled.

In terms of triggering conditions, the transfer of control can serve as a triggering event, and the time requirement, such as an exercise period, can also be added as a triggering condition. Certainly, there may be no specific triggering conditions at all. In such cases, drag-along and tag-along arrangements can be established as a special investment equity that can be exercised unconditionally by the right holder.

Members and Attributes

The tag-along and drag-along terms define the share transaction linking objects and the share transaction linking mapping table with the structure "share seller user number -> share transaction linking objects".

The members of the (share transaction) linking object include a link rule object and a list of follower's user numbers. Among them, the link rule object is defined in the rule parser repo, and its attributes are mainly the triggering conditions of the drag-along and tag-along arrangement; the follower refers to the obligor who is required to follow and sell the share in the drag-along arrangement, and the right holder who can request to sell the share in the tag-along arrangement.

The seller of the share is the search key in the drag-along and tag-along arrangements, and can obtain the triggering conditions, exercise rules and counterparties of the relevant arrangement by user number.

Linking rules

Meaning of linking Rules of Attributes

Attribute

Commercial and Legal Meaning

triggerDate

Trigger date.

effectiveDays

Number of effective days.

triggerType

Trigger condition categories. 0-unconditional trigger, 1-transfer of control, 2-transfer of control and price above threshold, 3-transfer of control and ROE above threshold.

shareRatioThreshold

The minimum shareholding for company control ( unit: basis points).

rate

Rate. Category 2 refers to the transfer price; Category 3 refers to the annualized ROE.

proRata

Whether or not to exercise the right at the voting ratio if the right holder claims a conflict.

Query API

API Name

Function and Usage

isDragger

Query whether a user with a specific number is an share seller with a drag-along and tag-along term.

getLinkRule

Query the corresponding share transaction linking rule by share seller's user number.

isFollower

Query whether a user with a specific number is a follower of a seller with a specific number.

getDraggers

Query to get a list of all seller numbers under the drag-along and tag-along term.

getFollowers

Query to get a list of all follower's numbers for a specific numbered seller.

priceCheck

Query whether the price of a specific transaction for a particular investment agreement meets the minimum price or minimum ROE requirements of the Linking Rules.

isTriggered

Query whether a specific transaction for a specific investment agreement triggers a drag-along and/or tag-along term.