Understanding Reps, Warranties & Deal Risk

About this episode

The episode discusses the importance of representations, warranties, and indemnification provisions in mergers and acquisitions and how they affect deal risk.

A strong purchase price does not mean much if the agreement leaves one party exposed to unexpected liability after closing. In this episode of Transaction Talk, hosts Jennifer Fox and Eric Sigman break down representations, warranties, and indemnification provisions in mergers and acquisitions. Eric explains the difference between representations and warranties, what they cover, and the associated provisions. They discuss why these provisions remain important after a transaction closes, how buyers can seek compensation when a warranty is breached, and how escrow funds, seller notes, and survival periods provide financial protection. They also explore common claims involving inaccurate financials, how sellers can reduce their exposure, representations and warranties insurance, the different risks involved in asset and stock sales, and why due diligence cannot uncover every possible problem. Tune in to learn how buyers and sellers can negotiate a fair allocation of risk and protect themselves throughout the transaction process. Key Points From This Episode: Discover what representations and warranties mean in an M&A agreement. Learn why risk can continue after closing a deal…

People in this episode

Hosts: Jennifer Fox, Eric Sigman

Topics covered

• mergers and acquisitions
• representations and warranties
• deal risk
• financial protection
• due diligence

Keywords

• M&A
• liability
• escrow funds
• survival periods
• financial losses
• warranty breach
• risk allocation

Mentioned in this episode

Organizations: Transaction Talk

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