Further to our earlier post discussing COVID-19 and Material Adverse Change (“MAC”) provisions in merger and acquisition agreements, and the procedural ruling in respect of the dispute involving Rifco Inc. (“Rifco”), ACC Holdings Inc. (“Purchaser”), and the Purchaser’s parent company, CanCap Management Inc. (“CanCap”), each of Rifco, the Purchaser and CanCap, (collectively, the “Parties”) settled their claims against each other for a payment by CanCap and the Purchaser to Rifco of an aggregate of $1.5 million. Further, the Parties entered into a full and final mutual release settlement agreement dated July 29, 2020 (the “Settlement Agreement”) in connection with the arrangement agreement dated February 2, 2020.
As a result of this Settlement Agreement, the interpretation of MAC provisions in Canada remains uncertain due to the continued lack of court decisions. We will continue to follow future court proceedings relating to the interpretation of MAC provisions, including with respect to the COVID-19 pandemic.