Answer:
The enormous impact the COVID-19 outbreak has had on individual companies, industry sectors, and the economy overall, coupled with the continuing uncertainty about the duration and magnitude of its effects, presents a difficult challenge for parties negotiating M&A agreements in this environment. Sellers naturally want the buyer to bear all risk associated with COVID-19 since the risk (if not its full impact) is known, and because the seller of a company today, probably accepting a lower price than might have been obtained just a few weeks ago, does not want to give the buyer open-ended conditionality. At the same time, no buyer can really know the full extent of the risk that COVID-19 represents, and the buyer might reasonably want to be able to back out if things get a lot worse or affect a particular business in a way that might not be reasonably anticipated at the time of signing the deal.
