Material Adverse Change or Effect

(redirected from MAC Clause)

Material Adverse Change or Effect

Many mergers and acquisitions contracts include a material adverse change clause that allows a company to renegotiate or walk away from a deal if the other company or its subsidiaries announces a significant event that may negatively affect its stock price or operations. See also materiality.

Material Adverse Change or Effect

A clause in some merger and acquisition contracts allowing the acquiring to cancel a deal before it is finalized if material information is revealed that negatively impacts the target company's stock price. See also: Due diligence.
References in periodicals archive ?
In contrast, the vast majority of US deals used a MAC clause (94%).
Some acquiring companies have utilized the MAC clause to walk away from a deal because the target became less attractive during the interval period (Herman and Piereck, 2010).
QNB will not use the MAC clause it said in its conference call and already pencilled in a potential fall in the EGP/USD to 7.
A MAC clause is a clause typically requested by the purchaser of a business to be inserted into a sale and purchase agreement (SPA).
In 2007, a MAC clause led to a reduction in the sale price for
Bank of America shareholders approved the agreement with the MAC clause December 5, 2008.
As previously discussed, the MAC clause is something often relied upon as an exit strategy by buyers.
Another way to navigate the lending process with some order is to lock in the entire loan coupon by effectively buying out the MAC clause language in the loan agreement.
We have had a MAC clause in each facility but we're not alone -- most companies have some kind of MAC clause in their facilities.
MAC clauses - the proportion of deals with a MAC clause remained unchanged at 14% in 2013 and remain rare in Europe compared with the USA where most (94%) of deals have MAC clauses.
It invoked a MAC clause (material adverse change clause) in early 2009 and blamed tough market conditions as the reason for invoking the MAC.
Fitch notes that the credit facility does have a MAC clause prior to each borrowing.