Specialized in foreign related legal services, Chinese lawyers
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What is Take or Pay?


MAC is for Material adverse change, MAE is for material adverse event or material adverse effect. The definition of the MAC/MAE clause is one of the most important and heavily negotiated definitions in any finance documentation, also in merger and acquisition. The purpose of the MAC/MAE clause is to provide the lender or the acquirer with protection such that if a major adverse change occurs from the date a loan or acquisition/merger agreement is signed – and such a change may relate to any number of factors, then an event of default is triggered and the lender/acquirer can essentially pull out of the transaction and often demand immediate repayment of any funds already lent to the borrower, or demand compensation from the seller/target company, together with interest and any other costs payable.

Gong Chu, Oscar

A lawyer at DeHeng Law Offices (Shenzhen)

Floor 22/11/19/33, Section B, Anlian Plaza,

No. 4018, Jintian Rd., Shenzhen. 518026 P.R.C

Mobile: +86 135 9049 6399, +86 186 8246 3518