The agreement is particularly important as the bidder has had access to the confidential financial information of the entity concerned. In 2019, video game distributor GameStop signed a status quo agreement with a group of investors who wanted changes in corporate governance, believing that the company had intrinsic value when the share price reflected. In the typical friendly and negotiated acquisition, both parties enter into a confidentiality agreement or confidentiality agreement (known as “CA” or “NDA” in the bar`s speech, but really the same thing). The main purpose of these agreements is to enable the parties to provide the other party with personally confidential business, financial and other information in order to assess a potential transaction and conduct due diligence. Each receiving party undertakes to keep the information from the publication portion confidential and not to use it, except as part of the evaluation of a potential transaction. A recent example of two companies that have signed such an agreement is Glencore plc, a Commodities trader based in Switzerland, and Bunge Ltd, an American agricultural commodities trader. In May 2017, Glencore took an informal step to buy Bunge. Shortly thereafter, the parties agreed to a status quo agreement that prevents Glencore from accumulating shares or making a formal offer for Bunge until a later date. Each NOA contains standard clauses describing when the agreement does not apply, z.B. (i) when the information is made public, except as a result of disclosure contrary to the agreement; or (ii) if the information is already known to the recipient at the time of disclosure; or (iii) if it is received or developed independently of the recipient. The reasons are obvious. They cannot prevent a person from reacting to information they already know or that is publicly available (to which all others can respond). During the status quo period, a new agreement is negotiated, which generally changes the original loan repayment plan.
This option is used as an alternative to bankruptcy or enforced execution if the borrower cannot repay the loan. The status quo agreement allows the lender to save some value from the loan. In the event of forced execution, the lender must receive nothing. By working with the borrower, the lender can improve its chances of repaying some of the outstanding debt. In other areas of activity, a status quo agreement can be virtually any agreement between the parties, in which both parties agree to discontinue the case for a specified period of time. This may include an agreement to defer payments to help a company in difficult market conditions, agreements to stop the production of a product, agreements between governments or many other types of agreements. “The receiving party undertakes not to circumvent, bypass or circumvent the revealing party directly or indirectly, in order to avoid or collect payment or collection of commissions or commissions in a transaction, or to assign or exploit any possibility of remuneration related to a client, product, property, concept, strategy, strategy, sales opportunity, business relationship, project and/or source of capital by the revealing party.