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Tender and Support Agreement
Practical Law Glossary Item 0-500-6657 (Approx. 2 pages)
Glossary
Tender and Support Agreement
An agreement used in a two-step merger between a stockholder of a target company and the buyer in which the stockholder agrees to:
- Tender the stockholder's shares of stock in the tender offer once it has commenced.
- Not withdraw the shares once tendered.
- Vote the stockholder's voting interest in favor of the proposed merger transaction and against any proposal in contravention of such proposal.
The purpose of a tender and support agreement is to ensure the buyer that certain significant stockholders will tender their shares or otherwise vote to approve the subject transaction. A tender and support agreement may also include the stockholder's grant of an irrevocable proxy to the buyer to vote the stockholder's shares in accordance with the terms of the tender and support agreement.
For additional information on tender offers, see Practice Note, Tender Offers: Overview.