# Acquisition

*Acquisition* is the process of transferring all assets, debts, contracts, ownership, and control to a new owner, the *Purchaser*, by compensating shareholders of the *Target Company* with cash and/or equity of the purchaser. Normal operations do not cease, there are no changes to the treatment of outstanding contracts, including employment, services, and debt. The only change is the ownership and capital structures.

## Acquisition Proposal 

The *Purchaser* offers an explicit amount of stablecoins and/or shares to acquire a *Target Company.* If this requires the authorization of additional shares, approval of [shareholder governance](/protocol/shareholder-governance.md) is required. 

## Acquisition Approval 

An acquisition must be approved by the target company’s [shareholder governance](/protocol/shareholder-governance.md). Before approval, the entire event can be simulated for total clarity to all parties. 

## Payout Calculations

If the acquisition is approved, the shareholders of the *Acquisition Target*  receive compensation in exchange for the control of the company and all of its assets. Compensation is delivered in the form of cash (stablecoins) and/or shares. The acquisition payout structure follows the seniority structure of shares. This means that investors still receive additional compensation to account for their liquidation preference. If cash is a part of the deal, that first goes to paying liquidation preference. If the deal is all-stock, then investors receive additional stock equal to the dollar-value of the liquidation preference. 

The process of acquisition include standard treatment for minority shareholders. Minority shareholders enjoy ***tag along rights*** and majority shareholders enjoy ***drag along rights***. 

## Treatment of Debt

The acquisition process does not directly affect the debt of the company; it is entirely transferred to the new owners along with all existing operating contracts, service contracts, employment contracts, etc. The new owner’s capital stack is now responsible for the assurance of all obligations. After acquisition, if an obligatory payment is not made, delinquency falls upon the acquiring company. <br>


---

# Agent Instructions: Querying This Documentation

If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question.

Perform an HTTP GET request on the current page URL with the `ask` query parameter:

```
GET https://docs.mezzanine.xyz/protocol/lifecycle-events/acquisition.md?ask=<question>
```

The question should be specific, self-contained, and written in natural language.
The response will contain a direct answer to the question and relevant excerpts and sources from the documentation.

Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.