Breach of balance sheet guarantees

In Mergers & Aquit­si­ti­ons (M&A) — purchase agree­ments, a balance sheet guaran­tee is found as stan­dard, because of which protra­c­ted nego­tia­ti­ons often arise. The ques­tion arises as to whether a “subjec­tively soft” or “objec­tively hard” balance sheet guaran­tee should be issued. The inter­pre­ta­tion and, above all, the legal conse­quen­ces of brea­ching balance sheet guaran­tees have been contro­ver­sial for years.