A client is prudently engaging with its bank to put in place a credit facility to address working capital needs which it anticipates might grow due to the Covid-19 isolation measures causing its customers to reduce requirements for its services and to pay more slowly than during less distressed times. As the motivation for this client to enter into the facility was its potential exposure to the risks to general economic conditions arising from the pandemic, the client was understandably concerned about the lender\u2019s insistence on the inclusion of a \u201cMaterial Adverse Change\u201d or \u201cMAC\u201d representation and event of default.<\/p>\n
The client\u2019s question to us, after vain attempts to remove the language and tepid protestations from its relationship manager that such clauses \u201care rarely relied upon\u201d, was whether it had any reason to be concerned.<\/p>\n
To read the full text of this post by Duane Morris partner Drew Salvest<\/a>, please visit the Duane Morris London Blog<\/em><\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":" A client is prudently engaging with its bank to put in place a credit facility to address working capital needs which it anticipates might grow due to the Covid-19 isolation measures causing its customers to reduce requirements for its services and to pay more slowly than during less distressed times. As the motivation for this … <\/p>\n