Cadwalader allows sharing content.
Email to a friend or colleague:
On October 1, 2018, the Delaware Court of Chancery found in Akorn, Inc. v. Fresenius Kabi AG, et al. that Fresenius was entitled to terminate its merger agreement with Akorn. In so ruling, Vice Chancellor Travis Laster found that: Akorn suffered a “Material Adverse Effect” (“MAE”) following the execution of the merger agreement; Akorn breached its representations related to regulatory compliance in a manner that would reasonably be expected to have an MAE; and Akorn did not comply in all material respects with its covenant to use commercially reasonable efforts to operate in the ordinary course of business following execution of the merger agreement. The decision is the first time a Delaware court has held that a seller has suffered an MAE, entitling the buyer to terminate an acquisition transaction. The decision offers insight into the interpretation of the term “Material Adverse Effect,” as well as other provisions com