3. Third, as a qualifier for certain commitments and assurances and guarantees given by borrowers-z.B. “the borrower does not violate a [essential contract] if such an infringement is reasonably likely to have a significant negative effect.” In the IBP case, the purchaser argued that the recent decline in the performance of the objective and an impairment charge resulting from internal accounting fraud, taken together, constituted an MAC. However, the purchaser had publicly indicated other reasons for terminating the merger and had not included in its public statements the arguments it had subsequently advanced in litigation. Id. at 65. The Tribunal ultimately found that the purchaser had not complied with its burden of finding a substantial adverse amendment under the contract. 3. Is the “mac” clause worded objectively? In other words, any discretion granted to the lender is to make the “Mac” provision on the model of an event or circumstance that, according to the lender, has a material adverse change… If the reinforced and italic text (or similar text) is not included in the “Mac” clause, it is written objectively. In these circumstances, the lender must regard the “Mac” as an objectively verifiable fact and the burden of proof is quite heavy.
In these circumstances, there is no doubt that the above general rules apply to the “mac” clauses and, therefore, it is likely that the pandemic itself could not have been invoked to trigger a “Mac” clause. The definition of “substantial adverse amendments” may be one of the most negotiated parts of a loan agreement, but it generally covers events with major negative effects: (i) having an activity, a condition (financial or otherwise) or the borrower`s prospects; and/or (ii) its ability to meet their obligations under the agreement. According to the clause of the MAC CONVENTION loan agreement, “since the date of this loan agreement [December 21, 2007], its financial position (possibly consolidated) has not changed much.” This representation was automatically repeated with Drawdown. The loan agreement also provided that a default under the BBVA credit contract constituted a default under the loan agreement. The loan agreement included a similar MAC provision for the surety. A misrepresentation of the financial situation would have been a default over the BBVA credit contract if it took place at a relevant time under the BBVA credit contract. On June 6, 2008, the developers/borrowers applied for a reduction under the loan agreement, but Carey did not proceed in advance and stated that the financial position and outlook of the development companies had deteriorated significantly until June 6, 2008. Carey then terminated the credit contract for non-payment of interest. In court, Carey argued that the financial situation of guarantor borrowers and borrowers had changed significantly until June 6, 2008. The Tribunal found that the financial situation of the surety had indeed changed significantly, but that the surety had not reiterated its presentation of its financial situation on June 6, 2008, since the date on which the submission was considered repeated was set in the BBVA credit contract and was “the first day of each interest rate period”, which was not June 6, 2008. In three of the four cases reviewed above, the lender was either tried against him or did not obtain a summary judgment in his favour, even though the facts appeared remotely favourable to the lenders. After all, in two of the three cases, the 2008 financial crisis had occurred and, in the third case, the guarantor`s finances had suffered massive declines.