Negotiating Material Adverse Change Clauses
Securing Favorable Purchase and Merger Deal Terms Through Sound MAC Clauses
Recording of a 90-minute CLE webinar with Q&A
Outline
- MAC clauses — current trends
- Recent settlements
- Pending lawsuits
- Current state of case law
- Common elements of MAC clauses, including exceptions
- Best practices for drafting and negotiating MAC clauses
- Mitigating risks
- Be specific about conditions constituting MAC
- Use broadly written MAC clauses only as “backstop” protection
- Mention information relied on, such as business or financial projections
- Watch language construction
- Buyer should include potential adverse events outside of seller’s control
- Include broad language to cover unknown risks
- Seller should attempt to limit specific carve-outs buyer proposes
- Seller might require that it have knowledge of MAC for clause to be enforceable
- Resolving conflicting positions
- Mitigating risks
- Dynamics of preparing and negotiating MAC clauses
- Expectations of MAC clauses
- When and how to use MAC clauses effectively
- Interrelationship of MAC clause with other clauses in merger agreement
Benefits
The panel reviewed these and other key questions:
- How has the recent trend of lawsuits impacted negotiation of MAC clauses?
- What is the current state of the law regarding MAC clauses?
- How can counsel for buyers and sellers best mitigate risk when drafting and negotiating MAC clauses?
Faculty
G. Thomas Stromberg
Partner, Corporate and Finance Law
Kaye Scholer
He is very familiar with the legal aspects of FAS 157. At the firm, his specialties include M&A, private equity,... | Read More
He is very familiar with the legal aspects of FAS 157. At the firm, his specialties include M&A, private equity, joint ventures and corporate governance, affecting clients in a variety of industries.
CloseVincent P. (Trace) Schmeltz, III
Counsel
Dewey & LeBoeuf
He litigates merger and acquisition disputes, pursuing and defending claims on behalf of corporations. He represented... | Read More
He litigates merger and acquisition disputes, pursuing and defending claims on behalf of corporations. He represented The Finish Line Inc. in recent litigation with UBS involving a MAC clause.
CloseClifford E. Neimeth
Shareholder
Greenberg Traurig
He has over 22 years of experience structuring, managing, negotiating and executing merger and acquisition... | Read More
He has over 22 years of experience structuring, managing, negotiating and executing merger and acquisition transactions. His clients include Fortune 500 acquirers and sellers. He is a frequent speaker on M&A strategies.
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$297