standstill agreement

standstill agreement
stand·still agreement /'stand-ˌstil-/ n: an agreement providing for the preservation of the status quo for a specified or indefinite period: as
a: an agreement under which litigation is forestalled between two parties
b: an agreement under which a party agrees to refrain from taking further steps to acquire control of a corporation (as by additional purchases of stock)

Merriam-Webster’s Dictionary of Law. . 1996.

standstill agreement
This expression covers a variety of arrangements:
• In a takeover situation, it is an agreement between a company and a shareholder which restricts the shareholder's ability to acquire further shares in the company.
• In a restructuring of a company's debts, it is an agreement between creditors to give the company time for information to be collected and for a survival strategy to be put together with a view to establishing a formal restructuring.
• In the context of limitation, a standstill agreement is an agreement which has the effect of suspending or extending a statutory or contractual limitation period.
+ standstill agreement
USA
An agreement in which a hostile bidder agrees to limit its holdings in a target company. A standstill agreement stops the takeover bid from progressing for a period of time.
A standstill agreement may also be used in a friendly transaction when a buyer or an investor in a PIPE transaction (PIPE) is restricted from purchasing the target's stock or taking any other actions that may lead to a business combination unless the target company's board and management are included in the process. These types of standstill agreements (usually contained in the confidentiality agreement) help the target company to control the deal process and prevent a hostile bid for the company after the buyer or investor has had the benefit of the target company's confidential information.
Standstill restrictions typically lapse after a period of time (commonly one to three years) or, in the case of PIPEs, when the investor owns less than a specified percentage of the target's stock (for example, 5%).

Practical Law Dictionary. Glossary of UK, US and international legal terms. . 2010.

Игры ⚽ Поможем сделать НИР

Look at other dictionaries:

  • standstill agreement — noun An agreement between parties to respect the status quo, esp granting more time for repayment of a debt • • • Main Entry: ↑stand …   Useful english dictionary

  • standstill agreement — contract by which the bidding firm in a takeover attempt agrees to limit its holdings of another firm. Bloomberg Financial Dictionary * * * standstill agreement standstill agreement ➔ agreement * * * standstill agreement UK US noun [C] ► FINANCE… …   Financial and business terms

  • Standstill Agreement — A standstill agreement is usually an instrument of a hostile takeover defense, in which an unfriendly bidder agrees to limit its holdings of a target firm. In many cases, the target firm is willing to purchase the potential raider’s shares at a… …   Wikipedia

  • Standstill Agreement — 1. A contract that stalls or stops the process of a hostile takeover. The target firm either offers to repurchase the shares held by the hostile bidder, usually at a large premium, or asks the bidder to limit its holdings. This act will stop the… …   Investment dictionary

  • standstill agreement — n. agreement that everything should remain as is; agreement between a creditor country and a debtor country that requires extra time to repay its debt …   English contemporary dictionary

  • standstill agreement — 1) An agreement between two countries in which a debt owed by one to the other is held in abeyance until a specified date in the future. 2) An agreement between an unwelcome bidder for a company and the company, in which the bidder agrees to buy… …   Big dictionary of business and management

  • standstill agreement — / stændstɪl əˌgri:mənt/ noun an agreement between a borrower and a lender that it is better to rengotiate the terms of the loan than for the lender to foreclose on the property used as security …   Dictionary of banking and finance

  • Standstill Agreement —    See London Conferences …   Historical dictionary of Weimar Republik

  • standstill agreement — американский термин, обозначающей достигнутое сторонами соглашение о том, что на протяжении определенного периода времени они не будут предпринимать никаких шагов, обычно заключается в связи с уже ведущимся или планируемым судебным или… …   Glossary of international commercial arbitration

  • agreement — a‧gree‧ment [əˈgriːmənt] noun [countable] 1. an arrangement or promise to do something, made by two or more people or organizations: • Under the agreement, the company will distribute our products in North America. • What happens if the warring… …   Financial and business terms

Share the article and excerpts

Direct link
Do a right-click on the link above
and select “Copy Link”