Legal Definitions - standstill agreement

A standstill agreement is a type of agreement where one party agrees to stop taking further action. This can be an agreement between two parties or more. It is often used in business to prevent hostile takeovers or to give a company time to restructure its finances.

One example of a standstill agreement is when a company agrees not to make a tender offer to take over another company for a specified period. This gives the target company time to evaluate the offer and come up with a plan to defend itself.

Another example is when financial institutions agree not to call bonds or loans when they are due. This gives the borrower time to restructure their finances and avoid defaulting on their debt.

These examples illustrate how a standstill agreement can be used to prevent aggressive actions and give parties time to negotiate and come up with a mutually beneficial solution.