Public Announcements Clause
(Acquisition Agreement)

Summary

This clause is a public announcements provision in an acquisition agreement, and it outlines the terms and conditions under which the parties involved in the transaction can make public statements or announcements regarding the deal. This clause includes practical guidance and drafting notes. This clause is important because it helps manage the flow of information to the public, investors, employees, and other stakeholders, ensuring that communications are consistent, accurate, and comply with legal and regulatory requirements. The clause establishes a mutual consent requirement for public communications, with specific timeframes for review and a clear stipulation that silence does not constitute consent. This creates accountability while preventing communication deadlocks. It establishes a structured framework that balances several competing interests, including: • Information Control: Regulates when and how information about the transaction reaches the public marketplace. • Regulatory Compliance: Ensures adherence to securities laws and disclosure requirements. • Stakeholder Management: Coordinates messaging to investors, employees, customers, and other stakeholders. • Reputational Protection: Prevents unauthorized or inaccurate disclosures that could harm either party. The key components of a public announcement clause focus on the following: • Designated Communicators: By requiring each party to designate both primary and alternate spokespersons, the clause creates clear lines of authority and responsibility for communications. The mandatory notification of spokesperson changes ensures continuity and prevents unauthorized disclosures. • Content and Timing Coordination: The requirement for good-faith cooperation in determining announcement content and timing establishes a collaborative approach while providing minimum review periods that balance thoroughness with business necessities. • Regulatory Framework: The clause acknowledges the complex regulatory landscape governing corporate disclosures, including SEC regulations, FINRA rules, and stock exchange requirements. It recognizes that these legal obligations may supersede contractual restrictions in certain circumstances. • Confidentiality Reinforcement: The clause strengthens overall transaction confidentiality by cross-referencing broader confidentiality provisions and specifically acknowledging injunctive relief as an appropriate remedy for breaches. • Modern Communications Coverage: By explicitly including social media and digital channels within its scope, the clause addresses contemporary communication risks that might otherwise fall outside traditional "press release" language. Ensure the clause is flexible enough to accommodate changes in circumstances, such as new legal requirements or changes in the transaction timeline. The capitalized terms and section references used in this clause should be conformed as necessary to align with the facts and circumstances presented, and to align with the terms set forth in the underlying agreement. For additional information on acquisition agreement clauses, see M&A Provisions Resource Kit, First Year Associate Resource Kit: Corporate and M&A, and Asset Acquisition Resource Kit.