GREECE Law and Practice Contributed by: Elizabeth Eleftheriades, Theodore Rakitzis, Angeliki Chalikia and Angelos Charalampidis, Kyriakides Georgopoulos Law Firm
notification form, procedure and required supporting documents for submitting an application under the control mechanism are still pending). For this rea - son, buyers may resist giving hard undertakings on FDI clearance, particularly if the sector is sensitive or highly sensitive (eg, energy, port infrastructure, digital infrastructure). Where applicable, the EU FSR is also beginning to feature in large transactions involving non-EU financial backing or state-linked investors. While not yet standard in Greek deal documentation, FSR undertakings are increasingly raised in cross-bor - der deals involving global sponsors, and sellers may require upfront disclosure and pre-clearance planning as a condition to signing. 6.6 Break Fees In Greece, break fees in favour of the seller are not standard in PE transactions, though they may be negotiated on a case-by-case basis – particularly in competitive auction processes, cross-border deals, or where the buyer is a financial sponsor with condi - tional obligations (eg, regulatory approvals or third- party consents). When used, break fees are generally structured as reverse break fees payable by the buyer (or its SPV) to the seller if the transaction fails to com - plete due to the buyer’s breach of contractual obliga - tions or failure to secure required approvals. Typical triggers include failure to obtain merger con - trol or FDI clearance (if not subject to a “hell or high water” obligation), financing failure (where applicable) or a breach of pre-closing covenants. The quantum of reverse break fees in Greek deals is usually negotiated and ranges between 5% and 10% of the purchase price, depending on the perceived execution risk. There is no statutory limit on break fees under Greek law, but excessive fees may be scrutinised under the principles of good faith and proportionality (Articles 281 and 288 of the Greek Civil Code), especially if challenged as punitive or coercive. Traditional seller break fees (payable by the seller to the buyer) are rare in private deals, but may arise in pre-sale exclusivity arrangements or failed auction processes 6.7 Termination Rights in Acquisition Documentation In Greek PE transactions, both buyers and sellers typi - cally have limited and clearly defined termination rights
under the acquisition agreement. The most common ground for termination is the non-satisfaction of con - ditions precedent (CPs) by an agreed longstop date, which is usually set between three to six months from signing, depending on regulatory timelines and trans - action complexity. These CPs often include: • obtaining merger control clearance; • obtaining FDI approval (where applicable); • fulfilment of specific third-party consents; and • remediation or compliance with material legal due diligence findings that are identified as conditions to closing. The buyer may also have the right to terminate if a material breach of the seller’s representations, warran - ties or covenants occurs prior to closing – particularly if such breach would result in a material adverse effect (MAE) or render the representations and warranties untrue in a material aspect as of the closing date. Sim - ilarly, sellers may be entitled to terminate if the buyer fails to complete for reasons such as failure to pay the purchase price, breach of pre-closing obligations, or failure to satisfy buyer-specific CPs. Some agreements include mutual termination rights if closing does not occur by the longstop date, regard - less of fault. While Greek law itself does not prescribe mandatory termination triggers, Greek acquisition agreements – particularly those influenced by inter - national PE practices – set out contractual regimes governing termination, including reverse break fees, specific performance clauses, and limitations on liabil - ity for pre- or post-closing breaches. 6.8 Allocation of Risk In Greek PE transactions, the overall allocation of risk typically differs depending on whether the counter - party is a PE-backed party or a corporate. PE sellers generally seek a clean exit and therefore negotiate for limited liability, often through short survival periods, narrowly defined warranties, and liability caps (typical - ly a low percentage of the purchase price). They also frequently push for the use of vendor due diligence reports, disclosure letters and exhaustive knowledge qualifiers to minimise post-closing exposure.
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