The COVID-19 pandemic affects borrowers and lenders and their financing arrangements. The most significant clause to consider is the Material Adverse Effect (MAE) clause – this clause broadly captures unpredictable and unforeseen events or circumstances that would otherwise be difficult to incorporate into the agreement specifically. Read our article on the impacts of COVID-19 on
Finance documents
COVID-19 and Finance Documents: Could the Material Adverse Effect clause be triggered?
By Jackie Midlane on
How does the COVID-19 pandemic affect borrowers and lenders and their financing arrangements?
A Material Adverse Effect (MAE) clause is included in most finance agreements. It is a catch-all concept to capture unpredictable and unforeseen events or circumstances that would otherwise be difficult to incorporate into the agreement specifically.
Broadly, a MAE clause covers a…