Last week, the DOJ’s Antitrust Division announced an update to its merger review process – specifically, that it plans to again implement targeted Second Request investigations – and published a model timing agreement. This Goodwin alert says:
The 2026 model introduces an “Expedited Consideration” fast track that gives parties a formal pathway to resolve or narrow a Second Request investigation without having to fully comply.
Expedited Consideration allows parties to produce focused, targeted documents and data covering what the DOJ identifies as potentially decisive issues and receive a formal response from DOJ leadership within a defined time frame. If the DOJ concludes the deal does not present material antitrust concerns based on that targeted production, it can close the investigation without requiring full compliance with the Second Request. If the DOJ concludes more is needed, it will communicate that to the parties. This is a significant structural change: Expedited Consideration formally establishes, directly in the model agreement, an early off-ramp from the Second Request process.
The alert notes that the DOJ is calling this a “resumption” of a prior approach, but also points out that negotiated quick look investigations in the past were ad hoc and case-by-case without a standardized practice or deadlines.
Expedited Consideration takes that informal practice and makes it a formal, elective option. Parties electing to enter into timing agreements now have a defined right to invoke it, with fixed submission and response deadlines built directly into the model agreement.
In April 2026, the Delaware Court of Chancery issued a significant decision interpreting the new DGCL § 122(18), which governs stockholder agreements. In the underlying case, founder and former CEO/chair Kiani sued Masimo in California for severance and a “Special Payment” under the terms of his employment agreement after resigning from the company for “Good Reason” following his removal from the board. The Special Payment (2.7 million RSUs (approximately 5% of Masimo’s outstanding shares) plus $35 million) was triggered by Kiani losing his chair title or a board “Change in Control,” and removing him for cause required a 75% supermajority board vote.
Masimo countersued in Delaware to invalidate the employment agreement as a product of breaches of fiduciary duty (relying on a Delaware forum clause in its bylaws). Despite the “employment agreement” label, the court found the agreement’s substance (governing board composition and allocating control rights long-term) made it a § 122(18) governance/stockholder agreement, citing Masimo’s own “poison pill” characterization of the arrangement.
The court held that § 122(18) abrogates the “Independent-Source Principle” for qualifying stockholder agreements and eliminates the requirement of explicit language to route fiduciary claims away from Delaware. The broad “arising out of or relating to” forum language included in the agreement was held to capture Masimo’s fiduciary duty and waste claims; the case was dismissed in Delaware and sent to California.
The employment-agreement-deemed-stockholders-agreement had a California forum selection clause. As the decision explains, “Independent-Source Principle” refers to the idea that “a contractual forum selection clause cannot encompass corporate fiduciary duty claims where the at-issue fiduciary duties arise independently of the contract.” Here’s what the decision says about that argument in the context of this case and Section 122(18):
Under the Company’s reading of precedent, Delaware courts have preserved Delaware as a forum for fiduciary duty claims to ensure the state can provide oversight for those who control its corporations. Although that may have been Delaware law once, it no longer is, at least for governance agreements under recently enacted § 122(18).
The court reasoned that Section 122(18)’s proviso (“provided that no provision of such contract shall be enforceable against the corporation to the extent such provision is contrary to the certificate of incorporation or would be contrary to the laws of this State (other than § 115 of this title) if included in the certificate of incorporation”), specifically the exclusion of Section 115 which “preserves Delaware courts as a mandatory option to adjudicate internal affairs claims” means that the “legislature authorized stockholder agreements that route internal affairs claims related thereto exclusively to a non-Delaware forum.”
The legislative synopsis expressly memorializes that intent by stating, “[t]he proviso excludes § 115, so that corporations may enter into contracts under § 122(18) with exclusive forum and arbitration provisions that do not select the courts of this State to adjudicate claims under the contracts.” The legislature reaffirmed that intent in the synopsis for the 2025 amendment to § 115, writing “[§] 115 [is] not intended to prevent . . . the selection of a forum other than a court in this State, if the provision is included in a stockholder agreement or other writing signed by the stockholder against whom the provision is to be enforced.”
Fenwick’s summary takeaways are:
– Section 122(18) will be construed broadly
– Substance over label controls
– A company’s own characterizations can later be used against it
They suggest that companies be careful how they characterize agreements “that touch on governance or control rights,” lest those characterizations later come up in litigation.
As this Cleary blog indicates, the European Commission recently published its report documenting the results of its first review of the Foreign Subsidies Regulation (FSR) for its first three years, and the EC Staff also published a Working Document detailing the feedback received on the FSR Guidelines published in January and how that feedback was taken into account. The EC’s FSR introduced a new and supplemental merger review regime requiring approval for transactions involving companies that have received financial support from non-EU governments. Here are some stats from the report highlighted by the Cleary team:
The FSR has caught far more transactions than anticipated (averaging 100 per year) while the intervention rate is extremely low: 99% of mergers were cleared without an in-depth review.
In 20% of these cases, the filings did not report any foreign financial contributions (FFCs) as these all fell within the reporting exemptions.
Given this data, the blog says:
In response, the Commission will propose targeted changes to streamline the regime. These include higher notification thresholds for merger filings and a simpler filing form for public tenders. The Commission will publish its detailed proposals in the fall and intends to adopt them in 2027.
The Commission is considering changes that would (a) reduce the overall number of notifications and (b) further streamline filing requirements. These include:
– Raising the turnover notification threshold, reportedly to €600 million;[3]
– Introducing a simplified process for low-risk mergers or FFCs;
– Increasing the thresholds for reportable FFCs in the merger filing (currently €1 million for individual FFCs and €45 million by country); and
– Introducing new exemptions for reportable FFCs in the filing.
For more background on the FSR regime, see these Mayer Brown FAQs.
Earlier this month, I blogged about the Delaware Supreme Court’s decision in Paragon Metals Holdings v. Smith, (Del.; 7/26), in which the Court held that gaps in the buyers’ due diligence did not preclude them from relying on allegedly fraudulent representations from the seller. This Mayer Brown memo discusses the decision. This excerpt addresses a few issues that I didn’t cover in my blog, the evidentiary standard applicable to fraud claims & the role of events that threaten the deal’s financing in establishing an MAE:
– Fraud claims are subject to the preponderance of the evidence standard—not a heightened clear and convincing evidence standard. The CEO argued that a “clear and convincing” evidentiary standard applies to fraud claims because fraud allegations carry moral stigma and can rest on circumstantial evidence. The Court rejected that argument and confirmed that ordinary civil preponderance remains the standard for Delaware fraud claims, noting that Delaware’s heightened pleading requirements already help screen out meritless claims.
– Events that threaten acquisition financing may help establish a material adverse effect. Proving an MAE remains difficult under Delaware law, so the trial court’s MAE finding is noteworthy. The “no MAE” representation was forward looking, and the trial court found it false because extensive changes to the target’s business with two major customers made it reasonably likely that the company would default on its acquisition financing and face bankruptcy. The Delaware Supreme Court affirmed that falsity finding because the CEO did not challenge the trial court’s conclusion.
The memo says that sellers should keep in mind that a forward-looking “no MAE” rep may require them to consider not only how the target operated prior to the closing, but also how any known adverse developments might affect the target after the closing given the buyer’s financing and capital structure. In other words, the memo says that “[t]he practical point is that sellers should assess forward-looking MAE representations against the real-world consequences of known adverse developments and disclose facts that could trigger those consequences.”
Traditionally, RWI insurers haven’t focused a lot of attention on a buyer’s due diligence investigation into the condition of the target’s assets. Insurers have generally operated under the assumption that buyers were conducting adequate due diligence investigations and that, in any event, condition of assets claims were unlikely to result in big losses to the carriers. According to this WTW blog, that’s no longer the case. This excerpt explains what’s changed – and why:
Over the past several years, the RWI market has absorbed some high‑severity claims tied to undisclosed or poorly understood asset‑condition issues. These have included:
Deferred maintenance and capex backlogs
Equipment failures shortly after closing
Systemic issues across multi‑site operations
Deficiencies in maintenance practices or asset‑tracking systems
Failures of highly technical or mission‑critical assets
These losses revealed a gap between what underwriters assumed buyers were doing and what diligence was actually being performed. In response, RWI insurers recalibrated their expectations. Buyers now encounter:
More detailed underwriting questions focused on physical assets, including historical maintenance and investment in capex
Heightened scrutiny of who performed the diligence and what their qualifications were
Requests for written technical or engineering reports
Narrower coverage positions when diligence is deemed insufficient or material issues are identified
The result is a more rigorous underwriting process in which asset‑condition risk is no longer treated as an afterthought.
The blog goes on to say that insurers now expect buyers to demonstrate a thoughtful and well-documented due diligence process if they expect full condition of assets coverage, and it provides details concerning insurers’ specific expectations concerning the quality and scope of that due diligence investigation in the current environment.
Experienced M&A practitioners know that the implied covenant of good faith can sometimes be used effectively as a wedge to pry open seemingly airtight contractual provisions in the name of “filling gaps.” However, many may not appreciate that, according to a recent Business Law Today article by contract guru Glenn West, an agreement’s “further assurances” clause can serve the same function.
Further assurance clauses typically include language to the effect that the parties are obligated to “take, cause to be taken, such further actions, as may be necessary, proper or advisable to evidence and effectuate” the transactions contemplated by the agreement. As this excerpt from Glenn’s article explains, there’s potentially more to this “boilerplate” than meets the eye:
While further assurances clauses are generally used to obtain an additional document necessary to fully evidence a transfer of assets in connection with the closing of a sale and purchase transaction, they are not necessarily limited to that purpose, particularly when they appear in an agreement governing an ongoing relationship.
Further assurances clauses have generally been described as “catchall contract provision[s] by which a party, after making a precise commitment to perform in some manner, makes a vague, more general commitment to take other actions that are incidental to, and necessary for, the performance of the core commitment.”
While “[s]uch a provision does not create a new obligation,” it may require parties to take additional actions that are consistent with the other express terms of the contract. One commentator has even described a further assurances clause as follows:
A further assurances provision is the exclamation point on the parties’ agreement. In the other parts of the agreement, the parties define their mutual objectives and detail their specific commitments to each other. By contrast, a further assurances provision is a general provision designed to require the parties to exercise a certain degree of effort to achieve the agreement’s overall objectives. It recognizes that parties do not and cannot contemplate and draft for every contingency. Thus, the further assurances provision serves as a gap filler and a back stop.
If that sounds a bit like an express version of the implied covenant’s gap-filling function, it should. One court has even suggested that “how other courts interpret the obligation to behave in good faith may suggest how a court should interpret the language contained in the Agreement’s further assurances clause.”
The article goes on to discuss how Vice Chancellor Laster interpreted the obligations imposed by a further assurances clause in a manner similar to those that might be imposed by the implied covenant in his recent decision in Facilities Holdings, LLC v. ASM Global Parent, LLC, (Del. Ch.; 6/26).
Ropes & Gray recently published the latest edition of its monthly “Dealmakers Digest,” which covers the top 10 M&A-related developments during June 2026. While quarterly deal volume broke records, the rising tide didn’t lift all boats. In fact, this excerpt suggests that last month was in many respects “the best of times” for mega-deals & strategics, and “the worst of times” for PE sponsors:
– Q2 2026 recorded highest deal value in recent history: With $1.7 trillion in global deal value, Q2 marked the highest quarterly value this century. Monthly deal value also reached a five-year high.
– Mega-deals mask declining deal activity: While the number of $10 billion-plus deals nearly doubled and deal values boomed year-over-year in 1H 2026, deal counts fell sharply–quarterly global count and outbound count hit decade lows.
– The widening strategic-sponsor gap: Since Q4 2025, strategic deal value has risen precipitously even as financial deal value has fallen. The gap widened significantly in Q2 2026, with strategic activity increasing 31% quarter-over-quarter and sponsor deal value declining 9%.
Strategic buyer deal value rose by 11% in June over the prior month to more than $560 billion, and year-over-year strategic value is up 84%. In contrast, financial buyer deal value shrunk 8% from May to June to fall below $100 billion. The report says that June represents the third consecutive month that sponsor activity has declined, although year-over-year sponsor deal value is up 18%.
Fenwick and Carta recently released their latest “Venture Beacon,” a periodic report on the state of the venture capital market. This one covers the first quarter of 2026, and this excerpt highlights some of the report’s key findings:
Venture fundraising activity continued to recover in 2025 and into Q1 2026. Total capital raised increased meaningfully from 2023 lows, continuing the broader recovery trend that began in 2024. Series D+ financings continued to represent a meaningful portion of total dollars invested, reflecting continued strength in later-stage financings.
Valuations continued trending upward across financing stages. Median Seed and Series A pre-money valuations reached record highs in 2025, while Series B, Series C, and Series D+ valuations continued rebounding from the declines experienced in 2022 and 2023. Year-over-year valuation growth remained positive across all major financing stages in both 2024 and 2025.
The gap between top-performing companies and the broader market widened. The spread between median and top-quartile companies expanded further in 2025. At the Seed stage, the gap between the 50th and 90th percentile valuations increased materially. Series A financings showed a similar trend, with the top 90th percentile valuations experiencing significant growth relative to 75th percentile and below.
The report also found that in an environment where fundraising conditions continued to stabilize, AI-related companies were the big winners, attracting a record 61% of all venture dollars raised during the first quarter. Hardware, crypto/web3, gaming, and AI-related companies enjoyed the highest valuations and largest median raises, while healthcare, biotech, consumer, and edtech companies generally came in at lower valuations and engaged in smaller fundraising rounds.
[T]he Delaware Court of Chancery held that, following a post-merger purchase-price adjustment that benefited the seller, the buyer may still receive indemnification from the seller for that adjustment payment if the adjustment was caused by a misrepresentation in the agreement or a warranty breach. The case shows that the Delaware courts recognize that contractual purchase-price adjustments and contractual indemnification processes are not mutually exclusive, but they can complement each other in a way that allows the processes to proceed according to their terms while effectuating the commercial intent of the parties.
Here are the facts as summarized by Sidley. There were a few issues and challenges leading up to this dispute, so buckle up.
The buyer acquired the seller in 2019 for a $750 million base purchase price, subject to a post-closing purchase-price adjustment based on whether certain accounting metrics at closing exceeded or fell short of agreed-upon targets. One such metric was “tangible net worth” — which the parties agreed would be determined in accordance with GAAP’s revenue recognition standard: ASC 606. Although the standard was new at the time, the seller represented that it had already been adopted and would have an immaterial impact on its pre-closing financials.
The merger agreement also naturally contained financial-statement representations. Among other things, the seller represented that its financial statements were prepared in accordance with GAAP and fairly presented, in all material respects, the company’s financial condition and results of operations. And as part of the post-closing purchase-price adjustment, the merger agreement also required that the estimated balance sheet and tangible net worth calculations be prepared in accordance with agreed accounting principles, which specifically required application of ASC 606.
After closing, it became known that the seller had misapplied ASC 606 in its pre-closing financials. Correcting that treatment produced a different tangible net worth adjustment by approximately $38.3 million, compared to what the buyer would have paid without the correct application of ASC 606. Thus, the seller sought a purchase-price adjustment. In response, the buyer filed a complaint in the Delaware Court of Chancery seeking a declaration and injunction to prevent the seller from asking the designated accountant to calculate the “Final Adjustment Amount” using an application of ASC 606 that was inconsistent with the pre-closing financial statements. The court reasoned that the parties’ agreement required ASC 606 to be applied correctly and, thus, the agreement did not prohibit the seller from asking the accounting firm to calculate the Final Adjustment Amount.
Given the concededly incorrect application of ASC 606, the outcome in the purchase-price adjustment process was that the buyer was obligated to pay the extra $38.3 million to the selling shareholders. Following the accounting proceeding, the buyer filed a new lawsuit, this time for indemnification. The buyer alleged that it overpaid the Final Adjustment Amount due to the seller’s breach of representations and warranties regarding the accuracy of its financial statements.
Ultimately, Vice Chancellor Fiorvanti held that the seller breached the merger agreement representation that its financial statements were prepared in accordance with GAAP and its estimated balance sheet obligations for the purchase-price adjustment provision. Seller tried to argue that the no-duplication provision prevented the claims. VC Fiorvanti disagreed since the no-duplication provision was intended to prevent double recovery, not bar indemnification claims generally, and that buyer proved that, if seller had applied GAAP correctly in the pre-signing and interim period, buyer would have avoided the entire $38.3 million upward adjustment. Sidley concludes:
Golden Rule teaches that while a purchase-price adjustment settles the final price, it does not decide who bears the risk that a representation was false or encroach on the purpose of indemnification. Absent language making the adjustment the exclusive remedy, a broadly drafted indemnity paired with a no-duplication provision aimed at true double recovery can provide a buyer a path to recovery where the adjustment payment itself is traceable to a breached representation, warranty, or covenant.
Earlier this week, the FTC announced a proposed settlement involving record fines ($12 million) for a failure to make a mandatory filing under the HSR Act. Here’s information from the announcement:
Under the terms of a proposed final judgment, Edwards, including former Genesis subsidiary JC Medical, will pay a $10 million penalty. Genesis will pay a $2 million penalty. Edwards will also be subject to additional terms including prior notice requirements. The combined $12 million penalty is the largest ever for failing to make an HSR filing [. . .]
According to the complaint, Edwards and Genesis intentionally structured their deal to avoid complying with the HSR Act, which requires parties to submit an HSR form to the federal antitrust agencies and observe a waiting period before completing a transaction. The waiting period provides the antitrust agencies with time to evaluate the transaction for potential competitive harm.
In July 2024, Edwards acquired JC Medical without filing under HSR and then, just one day later, attempted to acquire JC Medical’s only competitor, JenaValve Technology Inc. Had the transaction succeeded, Edwards would have owned the only two companies in the United States with TAVR-AR devices in clinical trials.
The FTC sued to block Edwards’ acquisition of JenaValve alleging that the deal was anticompetitive and, in January 2026, the U.S. District Court for the District of Columbia granted the FTC’s request for a preliminary injunction after a six-day hearing.
As you can tell from the above, the FTC alleged that avoidance tactics were used here. The announcement goes on to say:
According to the complaint, Edwards was concerned that HSR review would significantly delay closing on the acquisition of JC Medical, especially in light of its concurrent negotiations to acquire JenaValve.
To avoid HSR review, Edwards and Genesis agreed that Edwards would pay $115 million, plus milestone payments, for JC Medical, which fell just below the minimum size-of-transaction threshold of $119.5 million required at the time to trigger HSR review. Edwards, however, also agreed to a contemporaneous $25 million investment in Genesis in connection with the JC Medical acquisition, according to the complaint.
In substance, the transactions between Edwards and Genesis met the thresholds for mandatory reporting under HSR, as the combination amounted to more than $119.5 million, the complaint further alleges.