19Dec
Delaware Court of Chancery Issues Precedential Decision Addressing the Impact of COVID-19 on M&A Transaction, Finding Violation of Ordinary Course Covenant but No Material Adverse Effect
In AB Stable VIII LLC v. Maps Hotels and Resorts One LLC, the Delaware Court of Chancery issued a precedential decision addressing whether a buyer could walk away from an M&A transaction because the target company’s responses to the COVID-19 pandemic constituted either a “material adverse effect” (MAE) or a breach of the covenant to operate in the ordinary course of business between signing and closing (“Ordinary Course Covenant”). Although the MAE definition did not include an exception for...
By:
Akin Gump Strauss Hauer & Feld LLP
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