and the acquired corporation (“IBP”), on the require Tyson to waive any deficiencies in grounds that IBP fraudulently induced the due diligence as a basis for suit, unless that merger through misrepresentations and deficiency constituted a breach of omissions made during the due diligence representation or warranty in the resulting process. The Court of Chancery rejected merger agreement. Tyson's fraud claim, in part because of a non-reliance clause in the parties' Confidentiality Agreement entered into at the beginning of the parties due Then Vice Chancellor (now Chancellor) diligence/negotiation process: Strine determined that the quoted language in the Confidentiality Agreement . to an objective reader that the “emphasize[d] merger negotiation process not be one during which Tyson could reasonably rely on oral assurances. Instead, if Tyson wished We [Tyson] understand and agree that to protect itself, it would have to ensure that none of the Company, its advisors or any any oral promises were converted into of their ... representatives (i) have made or contractual representations and warranties.” make any representation or warranty, In applying New York law, the Court of express or implied, as to the accuracy or Chancery held that the disclaimer language completeness of the Evaluation Material in the Confidentiality Agreement was or (ii) shall have any liability whatsoever unambiguous and stated: to us or our Representatives relating to or resulting from the use of the Evaluation (emphasis added). Material or any errors therein or omissions therefrom, except in the case of (i) and (ii), [The Confidentiality Agreement] to the extent provided in any definitive contributes to the caution with which agreement relating to a Transaction. Tyson should have taken any oral assurances or representations from IBP (emphasis during the Merger negotiation process. Tyson had agreed that it could not use any In analyzing the foregoing provision, the oral or written due diligence information Court of Chancery held: as a basis for a (or omissions therefrom) lawsuit unless that issue was covered by The intent of the Confidentiality *115 a specific provision of a subsequent, Agreement is clear: it was designed to written contract. As a result, Tyson could
and the acquired corporation (“IBP”), on the grounds that IBP fraudulently induced the merger through misrepresentations and omissions made during the due diligence process. The Court of Chancery rejected Tyson's fraud claim, in part because of a non-reliance clause in the parties' Confidentiality Agreement entered into at the beginning of the parties due diligence/negotiation process: . We [Tyson] understand and agree that none of the Company, its advisors or any of their ... representatives (i) have made or make any representation or warranty, express or implied, as to the accuracy or completeness of the Evaluation Material or (ii) shall have any liability whatsoever to us or our Representatives relating to or resulting from the use of the Evaluation Material or any errors therein or omissions therefrom, except in the case of (i) and (ii), to the extent provided in any definitive agreement relating to a Transaction. (emphasis In analyzing the foregoing provision, the Court of Chancery held: The intent of the Confidentiality Agreement is clear: it was designed to require Tyson to waive any deficiencies in due diligence as a basis for suit, unless that deficiency constituted a breach of representation or warranty in the resulting merger agreement. Then Vice Chancellor (now Chancellor) Strine determined that the quoted language in the Confidentiality Agreement “emphasize[d] to an objective reader that the merger negotiation process not be one during which Tyson could reasonably rely on oral assurances. Instead, if Tyson wished to protect itself, it would have to ensure that any oral promises were converted into contractual representations and warranties.” In applying New York law, the Court of Chancery held that the disclaimer language in the Confidentiality Agreement was unambiguous and stated: (emphasis added). [The Confidentiality Agreement] contributes to the caution with which Tyson should have taken any oral assurances or representations from IBP during the Merger negotiation process. Tyson had agreed that it could not use any oral or written due diligence information (or omissions therefrom) as a basis for a lawsuit unless that issue was covered by *115 a specific provision of a subsequent, written contract. As a result, Tyson could
RAA%20Management%20v%20Savage%20Sports%20Holdings--Waiver%20of%20Fraud%20Claims.docx