Material Adverse Change Clauses Under Scrutiny - Return of the MAC?
In this article for Corporate Disputes, Rajinder Bassi, Harkiran Hothi and Guy Buckle explore a common feature of share purchase agreements: the inclusion of a clause allowing the buyer to terminate the transaction if the target company’s circumstances significantly deteriorate between signing and closing. Known as material adverse effect (MAE) or material adverse change (MAC) clauses, these often-overlooked provisions can have a decisive impact on deals that may have taken months to negotiate.
