Representations and Warranties in Mergers & Acquisitions

Описание: M&A Deal Tips #8: M&A Attorney Mary Beth Kerrigan talks about representations and warranties in M&A transactions.

In the M&A context, often when buyers deliver a first draft of the purchase agreement they will include a very lengthy section of representations and warranties from the seller. These typically describe the seller's business in detail. For example, they will include items such as compliance with applicable laws, any outstanding litigation and a description of that litigation, intellectual property, and other material contracts the company owns, so that the seller will be required to put together a disclosure schedule, which sets forth and describes all of the detail included in the representations and warranties in the underlying purchase agreement. These representations and warranties in a purchase agreement are standard and any seller should expect a very lengthy provision that includes these items. Reviewing these representations and warranties are very critical to the seller and thinking about the future post-closing potential indemnification obligations that a seller might have. We typically advise clients to put as much as possible on these disclosures schedules — the more the better — because it will help protect them from a claim by the buyer against the seller after closing. These include knowledge and materiality qualifiers.

See Mary Beth Kerrigan's attorney bio here:
https://www.morse.law/attorney/mary-b...

For more resources on M&A transactions, please see:
Mergers & Acquisitions Practice
https://www.morse.law/practice/corpor...

See also:
Top Ten Issues in M&A Transactions
https://www.morse.law/news/issues-in-...