Material adverse change
The material adverse change — fondly known as a “MAC” is something ineffable and hard to describe in concept, but you will know one when you see it. It is a hotly debated topic among the negotiator community and a good example of the limitations of all this breathless smart contract chat.
English law
But what, exactly, is “material”? English lawyers might shrug and be a little hand-wavy here — you know, not trivial; not formalistic:
“‘Material’ has its normal meaning of something which is real, substantial, significant, not de minimis, something which would affect the way in which you look at something but not necessarily decisively”.[1]
Our American friends
But as the doyen of drafting attests,[2] our litigationey American friends have gone further down the rabbit-hole than that. Of course they have. There is US authority that “material” means “information that, if known, would cause a party to walk away from the transaction”. This is a high bar: a lot higher than “non-trivial”.
See also
References
- ↑ Attrill & Ors v Dresdner Kleinwort Ltd [2012] EWHC 1189 cited in Decura v UBS [2015] EWHC 171 see transcript
- ↑ Ken Adams, Rethinking “Material” and “Material Adverse Change”