'Intervening Event' Carveouts Risk Muzzling Boards

Law360, New York (August 22, 2013, 11:19 AM EDT) -- If Leap Wireless Inc. gets cold feet about selling itself to AT&T Inc., it had better start digging for gold under its San Diego headquarters.

That may be the wireless company’s best chance to wriggle out of a merger agreement that severely limits its ability to change its recommendation to shareholders.

Leap can terminate the $1.2 billion deal in the case of an “intervening event,” usually defined as a favorable change that was unforeseeable when the deal was signed. These clauses have appeared in about 30...
To view the full article, register now.