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Drag/Tag Deed of Adherence Template — Ireland
Adding a new shareholder to your Shareholders Agreement, or dragging a minority into a sale? Our free Deed of Adherence template handles all three scenarios — standard adherence for incoming buyers, drag adherence for outgoing minority sellers, and tag adherence for minority shareholders joining a majority sale. Drafted to the Companies Act 2014 (ss.94, 457-460) and executed as a deed under LCLRA 2009 s.64. Expert unlocks the dragged-seller warranty cap, management warranty exclusion, price equivalence carve-outs, permitted variations and completion coordination.
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DEED OF ADHERENCE — DRAG/TAG ALONG
Binding A New Party To A Shareholders Agreement — Ireland
NEW PARTY
Niamh O'Sullivan
11 Marlborough Road, Donnybrook, Dublin 4, D04 V3H7
PPSN 5544332Z
PPSN 5544332Z
By: Niamh O'Sullivan
COMPANY
Riverstone Technologies Limited
14-16 Lower Mount Street, Dublin 2, D02 KF42
CRO 612999
CRO 612999
By: Aoife O'Sullivan, Director
Shareholders Agreement dated 15 January 2024
40 Ordinary €1 shares
This Deed of Adherence (the "Deed") is made between the New Party and the Company (for itself and as agent for the Existing Shareholders). The New Party, in its capacity as outgoing shareholder being dragged, is bound under the drag-along provisions of the Shareholders Agreement to transfer the Sale Shares to the Buyer as varied by this Deed.
This Deed is executed as a deed under section 64 of the Land and Conveyancing Law Reform Act 2009 (individuals) or section 43 of the Companies Act 2014 (companies). The shares the subject of this Deed are 40 Ordinary €1 shares in Riverstone Technologies Limited (CRO 612999) (the "Sale Shares").
1.
DEFINITIONS AND REFERENCE
"Shareholders Agreement" or "SHA" means the Shareholders Agreement dated 15 January 2024 between Patrick O'Brien, Niamh O'Sullivan and the Company in respect of the Company. "Existing Shareholders" means the shareholders bound to the SHA as at the date of this Deed: The shareholders party to the Shareholders Agreement as at the date of this Deed, namely (1) Patrick O'Brien holding 60 shares (60%), and (2) Niamh O'Sullivan holding 40 shares (40%) — together the "Existing Shareholders", as evidenced by the Register of Members.. "Sale Shares" means the 40 Ordinary €1 shares in the Company the subject of this Deed. "Drag-Along Threshold" means seventy-five per cent (75%). Capitalised terms not otherwise defined herein have the meanings given in the SHA.
2.
ADHERENCE UNDERTAKING
The New Party hereby undertakes with the Company and the Existing Shareholders that the New Party shall, with effect from the date of this Deed, be bound by all the terms, obligations, rights and restrictions of the Shareholders Agreement as if the New Party had been an original party to the SHA in the capacity of outgoing shareholder being dragged, save as expressly varied by this Deed. The Company and the Existing Shareholders accept this adherence.
3.
DRAG-ALONG MECHANICS
Where Existing Shareholders (or the Existing Shareholders together with the Buyer) holding not less than the Drag-Along Threshold (seventy-five per cent (75%)) of the issued share capital of the Company propose to transfer their shares to a bona fide third-party buyer, those Selling Shareholders may serve a written drag-along notice on the New Party (a "Drag Notice") requiring the New Party to transfer all of the Sale Shares to the Buyer on the same per-share economic terms, simultaneously with the Selling Shareholders' transfer.
The New Party shall, within 14 Working Days of the Drag Notice, deliver to the Company's solicitors executed stock transfer forms in respect of the Sale Shares in favour of the Buyer, together with the share certificate (or indemnity for lost certificate). The Buyer shall pay the consideration to the New Party at Completion in immediately available funds.
The drag right is enforceable by specific performance and is irrevocable. Section 94 of the Companies Act 2014 governs the share transfer mechanics; section 105 governs the post-completion CRO filing.
The New Party shall, within 14 Working Days of the Drag Notice, deliver to the Company's solicitors executed stock transfer forms in respect of the Sale Shares in favour of the Buyer, together with the share certificate (or indemnity for lost certificate). The Buyer shall pay the consideration to the New Party at Completion in immediately available funds.
The drag right is enforceable by specific performance and is irrevocable. Section 94 of the Companies Act 2014 governs the share transfer mechanics; section 105 governs the post-completion CRO filing.
4.
TAG-ALONG MECHANICS
Where any Existing Shareholders propose to transfer shares representing more than 25% of the issued share capital of the Company to a bona fide third-party buyer in a transaction not triggering the drag-along right, the Selling Shareholders shall first serve a written tag-along notice (a "Tag Notice") on the New Party. each tagging shareholder may transfer the same proportion of its shareholding as the Selling Shareholder(s) is/are transferring (full pro-rata tag). The Tag Notice shall give the New Party not less than 14 Working Days to exercise the tag right by counter-notice. If the New Party exercises the tag right, the Buyer must acquire the tagged shares on the same per-share economic terms as the Selling Shareholders' shares, simultaneously, in the same currency and the same payment structure (subject to clause 5 where applicable).
5.
DRAGGED SELLER — WARRANTY SCOPE AND CAP
The dragged seller shall give only the title and authority warranties (i) that the dragged seller is the sole legal and beneficial owner of the Sale Shares free from encumbrance and has the right to transfer them, and (ii) that the dragged seller has the legal capacity to execute the sale documents. No business, operational, accounts, tax, employment, IP, property, environmental, or regulatory warranties shall be given by the dragged seller.
Cap: The dragged seller's aggregate liability under any warranty given pursuant to this Deed shall not exceed the gross proceeds actually received by the dragged seller for the Sale Shares (less any tax actually paid).
Cap: The dragged seller's aggregate liability under any warranty given pursuant to this Deed shall not exceed the gross proceeds actually received by the dragged seller for the Sale Shares (less any tax actually paid).
6.
EXCLUSION OF MANAGEMENT WARRANTIES FROM OUTSIDE SHAREHOLDERS
The new party acknowledges that the Buyer's management warranty package shall be given solely by the founder / executive director (Patrick O'Brien) named in the Shareholders Agreement. The new party shall not be required to give any management, operational, accounts, tax, employment, IP, regulatory or environmental warranties in connection with the Sale.
Identification of Management Sellers: For the avoidance of doubt, the Management Sellers giving the operational warranty package are: (1) Patrick O'Brien (Founder and CEO, holding 60 Ordinary shares). The dragged shareholder (Niamh O'Sullivan) is NOT a Management Seller and shall not be listed as such in the Sale Documents under any heading.
Identification of Management Sellers: For the avoidance of doubt, the Management Sellers giving the operational warranty package are: (1) Patrick O'Brien (Founder and CEO, holding 60 Ordinary shares). The dragged shareholder (Niamh O'Sullivan) is NOT a Management Seller and shall not be listed as such in the Sale Documents under any heading.
7.
PRICE EQUIVALENCE
The dragged seller shall receive consideration per share equal to the cash consideration per share payable to the Selling Shareholders at Completion plus the cash-equivalent value of any non-cash consideration per share. The dragged seller shall receive its consideration in cash on Completion unless the dragged seller elects in writing to receive the same non-cash consideration as the Selling Shareholders.
Excluded elements: Management retention bonuses, deferred consideration conditional on post-Completion employment or service, earn-outs tied to post-Completion business performance, escrow amounts greater than the dragged seller's pro-rata share of the warranty cap, and management equity rollover arrangements shall NOT apply to the dragged seller.
Excluded elements: Management retention bonuses, deferred consideration conditional on post-Completion employment or service, earn-outs tied to post-Completion business performance, escrow amounts greater than the dragged seller's pro-rata share of the warranty cap, and management equity rollover arrangements shall NOT apply to the dragged seller.
8.
PERMITTED VARIATIONS TO SHA AND ARTICLES
The new party hereby consents in advance to routine sale-mechanic variations of the Shareholders Agreement and the Articles of Association of the Company necessary to effect the Sale, including removal or waiver of pre-emption rights, share-class consolidation/sub-division, and amendment of consent / drag / tag rights solely for the purposes of the Sale.
Fundamental changes reserved (express consent required): Fundamental changes — capital reduction under sections 84-87 Companies Act 2014, change of corporate form (re-registration as PLC, LTD-to-DAC conversion, conversion to unlimited company), change of jurisdiction (cross-border merger or division under Part 17), winding-up resolution, any change to the rights attaching to the share class held by the dragged shareholder — remain subject to the dragged shareholder's express written consent and are NOT permitted variations under this Deed.
Fundamental changes reserved (express consent required): Fundamental changes — capital reduction under sections 84-87 Companies Act 2014, change of corporate form (re-registration as PLC, LTD-to-DAC conversion, conversion to unlimited company), change of jurisdiction (cross-border merger or division under Part 17), winding-up resolution, any change to the rights attaching to the share class held by the dragged shareholder — remain subject to the dragged shareholder's express written consent and are NOT permitted variations under this Deed.
9.
COMPLETION COORDINATION
Completion of the transfer of the Sale Shares under this Deed shall occur simultaneously with completion of the underlying Sale at the same place, in the same manner, and in immediately available funds. The dragged seller shall deliver executed stock transfer forms, share certificates and any required consents. The Buyer shall procure delivery of the Consideration.
Post-Completion CRO filing undertaking: The Company shall procure that, within 30 days of Sale Completion, the Register of Members is updated to record the transfer in accordance with section 105 of the Companies Act 2014; Form B5 (notice of share transfer) is filed at the CRO; the Beneficial Ownership Register is updated to reflect the new beneficial-ownership position; and the stock transfer form is presented to Revenue's eStamping system within 44 days of execution for the assessment and payment of stamp duty (1% under SDCA 1999).
Post-Completion CRO filing undertaking: The Company shall procure that, within 30 days of Sale Completion, the Register of Members is updated to record the transfer in accordance with section 105 of the Companies Act 2014; Form B5 (notice of share transfer) is filed at the CRO; the Beneficial Ownership Register is updated to reflect the new beneficial-ownership position; and the stock transfer form is presented to Revenue's eStamping system within 44 days of execution for the assessment and payment of stamp duty (1% under SDCA 1999).
10.
STATUTORY SQUEEZE-OUT INTERACTION
Where the Drag-Along Threshold is 90% or more, the parties acknowledge that sections 457 to 460 of the Companies Act 2014 (the statutory squeeze-out / sell-out regime) may also apply to the Sale. Nothing in this Deed shall prejudice the statutory rights of the Selling Shareholders or the New Party under those sections, and the parties shall co-operate to effect the Sale via the statutory regime where commercially appropriate.
11.
STAMP DUTY
Stamp Duty at the rate of 1% of the consideration for the Sale Shares is payable under the Stamp Duties Consolidation Act 1999. The Buyer shall procure that the stock transfer form is stamped via Revenue's eStamping system within 44 days of execution.
12.
GENERAL PROVISIONS
Assignment: the New Party may not assign its obligations under this Deed without the prior written consent of the Company.
Notices: any notice under this Deed shall be in writing, served by hand, registered post or email with read receipt to the addresses given above.
Severability: the invalidity of any provision does not affect the remaining provisions.
Counterparts: this Deed may be executed in counterparts, each of which when delivered is an original and all of which together constitute one Deed.
Third-party rights: the Existing Shareholders are intended beneficiaries of this Deed and may enforce its terms directly.
Notices: any notice under this Deed shall be in writing, served by hand, registered post or email with read receipt to the addresses given above.
Severability: the invalidity of any provision does not affect the remaining provisions.
Counterparts: this Deed may be executed in counterparts, each of which when delivered is an original and all of which together constitute one Deed.
Third-party rights: the Existing Shareholders are intended beneficiaries of this Deed and may enforce its terms directly.
13.
GOVERNING LAW AND JURISDICTION
This Deed is governed by the laws of Ireland and is executed as a deed under section 43 of the Companies Act 2014 (where any party is a body corporate) or section 64 of the Land and Conveyancing Law Reform Act 2009 (where any party is an individual). The courts of Ireland have exclusive jurisdiction.
EXECUTED AS A DEED at Dublin on 10 June 2026.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date indicated.
NEW PARTY
Niamh O'Sullivan
Date: ____________________
COMPANY
Aoife O'Sullivan
Director
Riverstone Technologies Limited
Date: ____________________
WITNESS
Eoin Gallagher BL
22 Earlsfort Terrace, Dublin 2, D02 R294
Date: ____________________
Available as a print-ready PDF or an editable Microsoft Word (.docx) file.
What Is a Drag/Tag Deed of Adherence?
A Deed of Adherence is the document by which a new party becomes bound to an existing Shareholders Agreement (SHA). Without it, a buyer of shares is bound only by the Articles of Association of the company — not by the contractual rights and obligations in the SHA between the existing shareholders.
In the M&A context, a Deed of Adherence carries three flavours: (1) <strong>standard adherence</strong> — an incoming buyer of shares agrees to be bound by the SHA; (2) <strong>drag adherence</strong> — an outgoing minority shareholder is involuntarily transferred to a buyer under the SHA's drag-along mechanism; (3) <strong>tag adherence</strong> — a minority shareholder joins a majority sale under the SHA's tag-along mechanism, exiting on equivalent economic terms.
Properly drafted, the Deed of Adherence prevents post-Completion fights about whether minority shareholders are bound, whether dragged sellers must give warranties they cannot meaningfully give, and whether the buyer must extract per-share equivalence for dragged minorities. A standalone lawyer-drafted Deed typically costs €1,000-€3,000.
What's Covered in This Template
The Deed of Adherence template covers the universal binding mechanics, drag-along, tag-along and statutory squeeze-out alignment. Expert unlocks the institutional drafting disciplines specific to dragged sellers.
New Joining Party
Incoming buyer, outgoing dragged shareholder, or minority exercising tag rights.
Company
The Irish company whose shares are subject to the SHA.
Existing Shareholders
Bound parties to the existing SHA by reference.
Reference SHA
Date, parties, defined terms incorporation.
Adherence Undertaking
New party agrees to be bound as if originally a party.
Drag Mechanics
Majority threshold (50%+1, 66%, 75%, 90%), price equivalence, notice period, completion mechanics.
Tag Mechanics
Full or capped pro-rata participation, price matching, notice period.
Statutory Squeeze-Out Alignment
Interaction with Companies Act 2014 ss.457-460 (90% threshold).
Stamp Duty
1% on share value under Stamp Duties Consolidation Act 1999, 44-day filing.
Deed Execution (LCLRA 2009)
Witness, execution place, execution date — deed validity requirements.
Dragged Seller Warranty Cap (Expert)
Title + authority warranties only, capped at proceeds received.
Management Warranty Exclusion (Expert)
No operational warranties from non-executive outside shareholders.
Price Equivalence (Expert)
Per-share economic equivalent with carve-outs for management-specific elements.
Permitted Variations (Expert)
Routine sale-mechanic variations pre-consented; fundamental changes reserved.
Completion Coordination (Expert)
Lock-step with underlying SPA; CRO Form B5 + eStamping undertaking.
How to Create a Drag/Tag Deed of Adherence
Build an institutional-grade adherence deed in minutes — covering standard, drag and tag scenarios.
- 1
Identify the New Party and the Adherence Type
Standard / drag / tag — drives the intro wording and warranty scope.
- 2
Identify the Company and Existing Shareholders
Company details + reference to existing shareholders bound by the SHA.
- 3
Reference the SHA and the Sale Shares
SHA date, parties reference, share count and class.
- 4
Configure Drag Mechanics
Majority threshold (50%+1, 66%, 75% or 90%) and notice period.
- 5
Configure Tag Mechanics
Full pro-rata, capped pro-rata, or no tag; notice period.
- 6
Add Witness and Execution Details
Witness name + address, execution place + date for deed validity.
- 7
Add Dragged-Seller Warranty Cap (Expert)
Title + authority warranties only, capped at proceeds received.
- 8
Add Management Warranty Exclusion (Expert)
No operational warranties from outside shareholders + Management Sellers identification.
- 9
Add Price Equivalence (Expert)
Per-share equivalence + carve-outs for management retention, deferred consideration, earn-outs.
- 10
Add Permitted Variations + Completion Coordination (Expert)
Pre-consent to sale-mechanic changes + lock-step Completion with the underlying SPA.
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Legal Considerations in Ireland
Irish drag/tag practice draws on the Companies Act 2014, the LCLRA 2009 deed-execution rules, and the body of Irish private M&A practice on minority protection.
This template is for information only and is not legal advice. Drag/tag deeds materially affect shareholder rights and must be aligned with the underlying Shareholders Agreement; engage Irish corporate solicitors for any institutional or PE-backed transaction.
Drafted for Companies Act 2014 + LCLRA 2009
Companies Act 2014 — Share Transfer Mechanics
Section 94 of the Companies Act 2014 governs the share transfer mechanics for Irish private companies; section 105 requires the Register of Members to be updated within 30 days of the transfer. Sections 457-460 contain the statutory squeeze-out / sell-out regime where 90% of shares are acquired in a takeover-style transaction — the drag mechanism in the SHA often dovetails with this statutory regime.
LCLRA 2009 — Deed Execution
Where the new party is an individual, the Deed must be executed under sections 64-65 of the Land and Conveyancing Law Reform Act 2009 — attested by a witness, signed and delivered. Where the new party is a body corporate, execution is under section 43 of the Companies Act 2014 (two directors, a director and the company secretary, or a single director with witness). Defective execution makes the Deed voidable and unenforceable.
Stamp Duty (SDCA 1999)
Stamp Duty at the rate of 1% of consideration applies on the share transfer under the Stamp Duties Consolidation Act 1999. The Buyer (or its solicitors) must present the stock transfer form to Revenue's eStamping system within 44 days of execution. Late filing attracts penalties; non-payment renders the transfer unstampable, which prevents the CRO recording the transfer and gives rise to indemnity claims against the dragged seller.
Murgitroyd v Purdy — Restrictive Covenants
Irish courts apply Murgitroyd v Purdy [2005] IEHC 159 strictly to restrictive covenants in M&A contexts — non-competes must be reasonable in duration, scope and territory, and must protect a legitimate interest (typically goodwill bought by the buyer). Adherence deeds often re-cite the underlying SHA restrictive covenants, which then bind the new party — care should be taken that the covenants are still proportionate to the new party's position.
Pre-Emption Rights and Permitted Variations
Most Irish SHAs contain pre-emption rights — existing shareholders have first refusal on share transfers. A drag-along bypasses pre-emption rights by definition. The Deed of Adherence should expressly waive or pre-consent to the variations required to effect the sale, preventing the dragged shareholder from blocking the deal post-trigger.
Beneficial Ownership Register (Companies Act 2014 s.151)
Every Irish company is required to maintain a Beneficial Ownership Register and file changes with the Central Register at the CRO. A drag/tag transaction changing the underlying beneficial ownership requires the Register to be updated and the change filed within the statutory window. Failure can attract daily fines.
Frequently Asked Questions
Create Your Drag/Tag Deed of Adherence Now
Generate an institutional-grade Irish Deed of Adherence in minutes. Configure drag and tag mechanics, dragged-seller warranty cap, price equivalence and completion coordination with the Expert tier.
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