MAC Clauses and Indemnification Provisions in M&A Deals: Recent Trends in Negotiating and Drafting

Implications of Recent Deal Litigation on the Negotiation of MAC Clauses

Recording of a 90-minute premium CLE webinar with Q&A

Conducted on Thursday, April 30, 2020

Recorded event now available

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Program Materials

This CLE webinar will provide guidance to deal counsel for negotiating and drafting material adverse change (MAC) clauses and the key indemnification provisions in M&A deals. The panelist discussion will include industry trends in deal negotiation and the continuing impact of the Akorn decision.


MAC clauses, which permit the cancellation of a deal under certain circumstances, are intensely negotiated and frequently litigated provisions in M&A transactions. Questions about what constitutes a MAC have been at the center of several disputed deals.

Counsel's failure to anticipate and address potential MACs and risks during the structuring of a deal can result in unintended legal and financial exposure for buyers and sellers. Further, the failure to coordinate the MAC clause with the representations and warranties clauses and other essential provisions in the acquisition agreement can create several problems.

In addition to MAC clauses, this program will address indemnification provisions in a private company M&A transaction, including current trends in survival periods, basket amounts, indemnity caps, and sandbagging provisions. Indemnification provisions are often the most critical risk allocation provisions in a private company M&A transaction.

Listen as Kenneth W. Clingen, Partner at Clingen Callow & McLean, discusses current trends surrounding the use and interpretation of MAC clauses in M&A deals, strategies for negotiating and drafting the terms, and the negotiation and drafting of indemnification provisions.



  1. Negotiating MAC clauses
    1. Be specific about conditions constituting a MAC
    2. Use broadly written MAC clauses only as "backstop" protection
    3. Watch language construction
    4. Include broad language to cover unknown risks
    5. The buyer should attempt to limit specific MAC exceptions seller proposes
    6. Implications of Akorn Inc. v. Fresenius Kabi AG
  2. Negotiating indemnification provisions in private company M&A transactions
    1. Materiality scrapes
    2. Survival periods
    3. Baskets, caps, escrow provisions
    4. Consequential damage waivers
    5. Anti-sandbagging clauses
    6. Recent developments in the Delaware statute of limitations


The panelist will review these and other key issues:

  • How has recent deal litigation impacted the negotiation of MAC clauses?
  • How can counsel for buyers and sellers best mitigate risk when drafting and negotiating MAC clauses?
  • What are the current trends to consider when drafting and negotiating indemnification provisions?
  • How has representation and warranty insurance affected Indemnification provisions?


Clingen, Kenneth
Kenneth W. Clingen

Clingen Callow & McLean

Mr. Clingen chairs the firm’s business counseling department. He is general counsel to a number of privately...  |  Read More

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