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Contract Termination Contract Terms Acquisitions

Morris James LLP

Chancery Refuses to Order Specific Performance Due to Inaccurate Representations and Warranties

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Restanca, LLC v. House of Lithium, Ltd., C.A. No. 2022-0690-PAF (Del. Ch. Jun. 30, 2023) - The parties seeking specific performance of an agreement must establish a clear right to performance, including that all conditions...more

Dorsey & Whitney LLP

“Everything zen? Everything zen? I don’t think so...” - MAE Clauses in the Time of COVID

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On March 1, 2022, the Delaware Court of Chancery delivered a memorandum opinion ordering a yoga franchisor to complete the acquisition of its franchisee’s chain of yoga studios. The case arose out of the parties’ pre-COVID...more

Goodwin

Survival Guide to Structuring Life Sciences Partnering and M+A Agreements

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The life sciences space is ever-growing and dynamic as the industry witnesses more companies and, therefore, more collaboration, licensing and M&A agreements, come into the spotlight. While these deals are exciting...more

Kramer Levin Naftalis & Frankel LLP

Sustained or Transitory? Delaware Court of Chancery Finds No MAE Absent Proof of Durationally Significant Effect on Business

Prior to the Delaware Court of Chancery’s opinion in Akorn, Inc. v. Fresenius Kabi AG, C.A. No. 2018-0300-JTL, 2018 WL 4719347 (Del. Ch. Oct. 1, 2018), aff’d 198 A.3d 724 (Del. 2018), no Delaware court had found the existence...more

Latham & Watkins LLP

Delaware Court Nixes Deal Due to Seller’s Failure to Operate in “Ordinary Course” During COVID-19

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The decision leaves the door open for buyers to argue that inflexible ordinary course covenants can provide a basis to terminate a transaction in which a seller does not suffer an MAE. Key Points: ..The Delaware Court...more

Kilpatrick

Monthly Minute | Due Diligence Considerations Related to COVID-19

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Once a month, we cover an interesting topic with a short video. This month, Associate Sarah Beth Barnes discusses due diligence considerations related to COVID-19....more

Harris Beach PLLC

Will COVID-19 Qualify as a ‘Material Adverse Effect’?

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The pandemic and associated lockdown orders changed economic projections virtually overnight. As a result, organizations which were under contract at the onset of COVID-19 – e.g., to merge with or acquire another entity or...more

Vinson & Elkins LLP

[Webinar] Navigating Heightened Contractual Risk in an Economic Downturn - May 28th, 12:00 pm - 1:00 pm CT

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We’re excited to introduce Navigating, a new webcast series created to assist clients and friends of the firm in navigating the new normal – whether that be navigating through pandemic-related issues, new industry dynamics,...more

McDermott Will & Emery

[Webinar] Preparing for Litigation Resulting from a COVID-Related Busted Deal - May 8th, 12:00 pm - 1:00 pm EST

Uncertainty continues to loom over the M&A market as organizations that were actively involved in transactions before the COVID-19 pandemic assess risks stemming from reduced valuations, condensed financing options, the...more

Perkins Coie

Beyond MAE: COVID-19-Related M&A Lawsuits in the Delaware Court of Chancery

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Several COVID-19-related mergers and acquisitions (M&A) complaints have been filed with the Delaware Court of Chancery since the start of this month, with spurned sellers alleging that buyers experienced a change of heart due...more

Akin Gump Strauss Hauer & Feld LLP

The Coronavirus and M&A Transactions: MAE Clauses

In late 2019, COVID-19 (more commonly known as the coronavirus) began to spread throughout mainland China, and has since spread around the world, affecting numerous lives and businesses. As a result, companies spanning a wide...more

Foley & Lardner LLP

Evaluating Transfers and Terminations in Increasingly Consolidated Reseller Networks

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Over the past few years, many manufacturing industries have faced a new trend: reseller (i.e., distributor or dealer) consolidation within channel networks. From the manufacturer’s standpoint, there is clear upside to this...more

Proskauer Rose LLP

When Mergers Go Bad: How Merger Agreements Deal with Antitrust Risk in Today’s Market

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When parties begin merger talks, it is with an eye toward getting the deal done, getting the sellers their consideration, and determining how the combined company can do a better job for customers, employees and shareholders....more

Dechert LLP

Sweat the Small Stuff: Delaware Court of Chancery Faults Acquirer for Failing to Deliver Notice to Extend End Date

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The Delaware Court of Chancery has ruled that an acquirer and target company’s joint efforts to obtain antitrust approval for a merger did not substitute for, or satisfy, the merger agreement’s requirement to send written...more

Skadden, Arps, Slate, Meagher & Flom LLP

Delaware Supreme Court Affirms Akorn

On December 7, 2018, the Delaware Supreme Court affirmed the Court of Chancery's decision in Akorn, Inc. v. Fresenius Kabi AG , C.A. No. 2018-0300-JTL, which upheld, for the first time under Delaware law, the ability of a...more

Fenwick & West LLP

Akorn v. Fresenius: Important Practical Lessons from First-Ever Material Adverse Effect

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On October 1, in Akorn v. Fresenius Kabi, the Delaware Court of Chancery for the first time found that a material adverse effect — or MAE — had occurred in a merger transaction, which, combined with other breaches of the...more

Dorsey & Whitney LLP

MAE is MIA No Longer: Delaware Court Upholds Use of “Material Adverse Event” Clause for the First Time

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In Akorn, Inc. v. Fresenius Kabi AG, the Delaware Chancery Court held that Fresenius, a German pharmaceutical company, was justified in invoking a “material adverse event” (MAE) clause to terminate its $4.8 billion merger...more

Foley & Lardner LLP

Akorn v. Fresnius Kabi: Delaware Court Provides Guidance on What Constitutes a Material Adverse Event

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A Delaware Chancery Court has allowed a buyer to cancel a deal based on a material adverse effect. The decision is believed to be the first of its kind in Delaware. In Akorn, Inc. v. Fresenius Kabi AG, the Delaware Court...more

Dechert LLP

Recent Delaware Case Makes First Finding of "Material Adverse Effect": Key Takeaways

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The recent decision of the Delaware Court of Chancery in Akorn, Inc. v. Fresenius Kabi AG et. al is the first time a Delaware court has found a material adverse effect in the M&A context, and reinforces current Delaware law...more

Bennett Jones LLP

Delaware Judge Finds Elusive MAC—Does It Change Anything?

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Purchasers of businesses often want an "escape hatch" prior to closing if the target business suffers a "material adverse change" (or a "material adverse effect"). Historically, based on court decisions primarily out of the...more

A&O Shearman

Delaware Court Of Chancery Rules For The First Time That MAE Justifies Termination Of Deal

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In a first-of-its-kind ruling, Vice Chancellor J. Travis Laster of the Delaware Court of Chancery ruled post-trial that Fresenius SE & Co. KGaA (“Fresenius”) properly terminated its $4.3 billion agreement to acquire Akorn,...more

Wilson Sonsini Goodrich & Rosati

Delaware Court of Chancery Finds a Material Adverse Effect and Permits Termination of Merger Agreement

In a 246-page post-trial decision issued this week, the Delaware Court of Chancery ruled that a buyer could terminate a $4.75 billion public company acquisition because of material adverse effects that had occurred at the...more

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