Pari Passu
Pari Passu is the equal treatment of multiple parties in an agreement.
For example, if 10 people each loaned $10,000 and the startup desired to pay down the debt by $50,000, each person would receive a pay-down of $5,000 if their collective payment rights were pari passu with each other.
Pari Passu can also be used for non-economic terms as well (e.g. registration rights).
About the Author
Ryan Roberts is a startup lawyer and represents technology companies through all phases of the startup process, including incorporation, seed & venture financings, and exit transactions. Click here to learn more about his practice.
