{"id":5728,"date":"2018-10-13T12:18:12","date_gmt":"2018-10-13T12:18:12","guid":{"rendered":"https:\/\/www.austinshortfilm.com\/blog\/indemnification-in-mergers-acquisitions-explained\/"},"modified":"2018-10-13T12:18:12","modified_gmt":"2018-10-13T12:18:12","slug":"indemnification-in-mergers-acquisitions-explained","status":"publish","type":"post","link":"https:\/\/www.austinshortfilm.com\/tech\/indemnification-in-mergers-acquisitions-explained\/","title":{"rendered":"Indemnification in Mergers &amp; Acquisitions Explained"},"content":{"rendered":"<p><iframe loading=\"lazy\" width=\"480\" height=\"270\" src=\"\/\/www.youtube.com\/embed\/pnPdfZUGxZU\" frameborder=\"0\" allow=\"autoplay; encrypted-media\" allowfullscreen><\/iframe><\/p>\n<p>#mergersandacquisitions #corporatelaw #businesslaw<br \/>\nhttp:\/\/cenkuslaw.com<br \/>\nhttp:\/\/braatenwoods.com<\/p>\n<p>In the context of mergers and acquisitions, indemnity clauses encapsulate the extent of liability a seller will assume post-closing based on the representations and warranties they present to the buyer. So, it&#8217;s especially important that sellers of a business carefully consider several factors about the scope of indemnification and how those representations are conveyed to a buyer in the purchase agreement.<\/p>\n<p>Fundamentally, indemnification is a guarantee of compensation for losses or damages incurred by the buyer of a business due to circumstances unforeseen at the time of closing. It&#8217;s a way to share risk between buyer and seller.<\/p>\n<p>If you&#8217;re selling a business and take only a few nuggets of wisdom away from this video, my tips regarding indemnification are:<br \/>\n1. Maximize the deductible<br \/>\n2. Minimize your cap<br \/>\n3. Shorten the survivability of indemnity (to the extent that you can)<br \/>\n4. Carefully consider representations and warranties made to the buyer<\/p>\n<p>Now, if you&#8217;re unclear on any of those four tips, watch the video! If you still have questions, feel free to reach out. Leave a comment or contact me.<\/p>\n<p>_____________________________________________<\/p>\n<p>For a deeper dive into  and other legal issues vital to the success of your deals and your business, visit me at:<br \/>\nhttp:\/\/www.cenkuslaw.com<\/p>\n<p>Just starting up? Check this out for my advice on startup success: http:\/\/www.thestartupshepherd.com.<\/p>\n<p>You can also reach me at:<\/p>\n<p>https:\/\/www.linkedin.com\/in\/brettcenkus<\/p>\n<div class=\"newsmag-video-container\"><a class=\"twitter-timeline\" data-width=\"600\" data-height=\"900\" data-dnt=\"true\" href=\"https:\/\/twitter.com\/bcenkus?ref_src=twsrc%5Etfw\">Tweets by bcenkus<\/a><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><\/div>\n<p>http:\/\/www.cenkuslaw.com<\/p>\n<div class=\"newsmag-video-container\">\n<blockquote class=\"wp-embedded-content\" data-secret=\"t3YTgloaYl\"><p><a href=\"http:\/\/www.cenkus.com\/\">Home<\/a><\/p><\/blockquote>\n<p><iframe class=\"wp-embedded-content\" sandbox=\"allow-scripts\" security=\"restricted\" style=\"position: absolute; clip: rect(1px, 1px, 1px, 1px);\" src=\"http:\/\/www.cenkus.com\/embed\/#?secret=t3YTgloaYl\" data-secret=\"t3YTgloaYl\" width=\"600\" height=\"338\" title=\"&#8220;Home&#8221; &#8212; Brett Cenkus\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\"><\/iframe><\/div>\n<p>_______________________________________________<\/p>\n<p>About me:<\/p>\n<p>My 20+ years of experience in business finance, business law and entrepreneurship have led me to believe that numbers and logic are awesome tools, but understanding human nature and emotions is the first step to business success. <\/p>\n<p>The Cenkus Law Firm provides services related to mergers &#038; acquisitions, general business issues and startups, including founders&#8217; agreements and fundraising. I also consult with entrepreneurs and have invested my own capital as an angel investor.<\/p>\n<p>From 2010-2013 I served as Chief Legal Counsel of a publicly-trade international oilfield services company. From 2001 to 2006 me and a partner founded and built Paragon Residential Mortgage. Paragon was sold to Bridge Investments in 2006. <\/p>\n<p>I hold a Juris Doctorate from Harvard Law School and a Bachelor of Arts degree in Economics from Messiah College in Grantham, Pennsylvania. <\/p>\n<p>Now, I live in Austin, TX with my wife and two kids. I enjoy reading, running, classic movies, great food and wine and some great American football.<\/p>\n<h3>More info on Indemnification in Mergers &#038; Acquisitions Explained<\/h3>\n<div class=\"ss-local-rss\"><div class=\"rss_header\"><h2><a href=\"https:\/\/cn.bing.com\/news\/search\/?q=Indemnification+in+Mergers+%26+Acquisitions+Explained&amp;qft=sortbydate%3D%221%22&amp;format=rss\" rel=\"nofollow\" class=\"rss_title\">Indemnification in Mergers & Acquisitions Explained - BingNews<\/a><br \/><span class=\"rss_description\"> Search results<\/span><\/h2><\/div><ul>\n            <li>\t\t\t\t<span class=\"title\">\n\t\t\t\t\t<a href=\"http:\/\/www.bing.com\/news\/apiclick.aspx?ref=FexRss&amp;aid=&amp;tid=6646df2e34614c99bda9df48e3bea08c&amp;url=https%3A%2F%2Falaskapublic.org%2F2024%2F05%2F16%2Fbill-will-allow-higher-insurance-reimbursements-for-injured-commercial-fishermen%2F&amp;c=14130357483550017464&amp;mkt=en-us\" rel=\"nofollow\">\n\t\t\t\t\t\tBill will allow higher insurance reimbursements for injured commercial fishermen\n\t\t\t\t\t<\/a>\n\t\t\t\t<\/span>\n\t\t\t\t<div>\n\t\t\t\t\t<p>Senate Bill 93, signed into law last month by Gov. Mike Dunleavy, increases the maximum payout from the fishermen\u2019s fund to $15,000.<\/p>\n\t\t\t\t<\/div>\n\t\t\t<\/li>\n            \n            <li>\t\t\t\t<span class=\"title\">\n\t\t\t\t\t<a href=\"http:\/\/www.bing.com\/news\/apiclick.aspx?ref=FexRss&amp;aid=&amp;tid=6646df2e34614c99bda9df48e3bea08c&amp;url=https%3A%2F%2Fnews.bloomberglaw.com%2Flitigation%2Fmerz-pharma-wins-injunction-against-ex-employee-who-took-info&amp;c=4012422816268383308&amp;mkt=en-us\" rel=\"nofollow\">\n\t\t\t\t\t\tMerz Pharma Wins Injunction Against Ex-Employee Who Took Info\n\t\t\t\t\t<\/a>\n\t\t\t\t<\/span>\n\t\t\t\t<div>\n\t\t\t\t\t<p>Merz Pharmaceuticals LLC is entitled to a preliminary injunction barring a former employee from disclosing trade secrets because it\u2019s likely to succeed on its claim that he violated a confidentiality ...<\/p>\n\t\t\t\t<\/div>\n\t\t\t<\/li>\n            \n            <li>\t\t\t\t<span class=\"title\">\n\t\t\t\t\t<a href=\"http:\/\/www.bing.com\/news\/apiclick.aspx?ref=FexRss&amp;aid=&amp;tid=6646df2e34614c99bda9df48e3bea08c&amp;url=https%3A%2F%2Fwww.bizjournals.com%2Fbirmingham%2Fnews%2F2024%2F05%2F15%2Fmotion-industries-acquisition-allied-circuits.html&amp;c=3426440541569900535&amp;mkt=en-us\" rel=\"nofollow\">\n\t\t\t\t\t\tGrowing Bham manufacturer acquiring New York company\n\t\t\t\t\t<\/a>\n\t\t\t\t<\/span>\n\t\t\t\t<div>\n\t\t\t\t\t<p>Birmingham-based Motion Industries Inc. is set to acquire a Buffalo, New York-based electrical firm. Motion, a distributor of maintenance, repair and operation replacement parts, signed a definitive ...<\/p>\n\t\t\t\t<\/div>\n\t\t\t<\/li>\n            \n            <li>\t\t\t\t<span class=\"title\">\n\t\t\t\t\t<a href=\"http:\/\/www.bing.com\/news\/apiclick.aspx?ref=FexRss&amp;aid=&amp;tid=6646df2e34614c99bda9df48e3bea08c&amp;url=https%3A%2F%2Fwww.msn.com%2Fen-us%2Fmoney%2Fcompanies%2Fvirtual-data-rooms-fueling-mergers-and-acquisitions-for-business-growth%2Far-BB1mrKgv&amp;c=2022763490131329136&amp;mkt=en-us\" rel=\"nofollow\">\n\t\t\t\t\t\tVirtual Data Rooms: Fueling Mergers and Acquisitions for Business Growth\n\t\t\t\t\t<\/a>\n\t\t\t\t<\/span>\n\t\t\t\t<div>\n\t\t\t\t\t<p>According to the info presented by Forescout,\u00a062% of dealmakers\u00a0admit that their companies faced a significant cybersecurity issue during mergers and acquisitions and that cyber risk is also their ...<\/p>\n\t\t\t\t<\/div>\n\t\t\t<\/li>\n            \n            <li>\t\t\t\t<span class=\"title\">\n\t\t\t\t\t<a href=\"http:\/\/www.bing.com\/news\/apiclick.aspx?ref=FexRss&amp;aid=&amp;tid=6646df2e34614c99bda9df48e3bea08c&amp;url=https%3A%2F%2Fwww.insurancebusinessmag.com%2Fus%2Fnews%2Fbreaking-news%2Fking-insurance-partners-expands-to-georgia-with-latest-acquisition-489314.aspx&amp;c=16075739456782517253&amp;mkt=en-us\" rel=\"nofollow\">\n\t\t\t\t\t\tKing Insurance Partners expands to Georgia with latest acquisition\n\t\t\t\t\t<\/a>\n\t\t\t\t<\/span>\n\t\t\t\t<div>\n\t\t\t\t\t<p>King Insurance Partners has expanded its operations by acquiring Palmer Insurance, a well-regarded agency based in Bainbridge, Georgia. The latest in a series of acquisitions, this move is part of ...<\/p>\n\t\t\t\t<\/div>\n\t\t\t<\/li>\n            \n            <li>\t\t\t\t<span class=\"title\">\n\t\t\t\t\t<a href=\"http:\/\/www.bing.com\/news\/apiclick.aspx?ref=FexRss&amp;aid=&amp;tid=6646df2e34614c99bda9df48e3bea08c&amp;url=https%3A%2F%2Fwww.statista.com%2Fstatistics%2F1103898%2Fmining-metals-industry-covid-19-merger-acquisitions-impact%2F&amp;c=13726424187299031991&amp;mkt=en-us\" rel=\"nofollow\">\n\t\t\t\t\t\tCOVID-19 impact on mining and metals industry mergers and acquisitions 2020\n\t\t\t\t\t<\/a>\n\t\t\t\t<\/span>\n\t\t\t\t<div>\n\t\t\t\t\t<p>Currently, you are using a shared account. To use individual functions (e.g., mark statistics as favourites, set statistic alerts) please log in with your personal ...<\/p>\n\t\t\t\t<\/div>\n\t\t\t<\/li>\n            \n            <li>\t\t\t\t<span class=\"title\">\n\t\t\t\t\t<a href=\"http:\/\/www.bing.com\/news\/apiclick.aspx?ref=FexRss&amp;aid=&amp;tid=6646df2e34614c99bda9df48e3bea08c&amp;url=https%3A%2F%2Fwww.forbes.com%2Fsites%2Fdeloitte%2F2024%2F05%2F02%2Fready-or-not-global-chemical-industry-executives-may-need-to-get-prepared-for-a-resurgence-in-merger--acquisition-activity%2F%3Ftrk%3Dpublic_post_comment-text&amp;c=16434533882378202712&amp;mkt=en-us\" rel=\"nofollow\">\n\t\t\t\t\t\tReady Or Not: Global Chemical Industry Executives May Need To Get Prepared For A Resurgence In Merger &amp; Acquisition Activity\n\t\t\t\t\t<\/a>\n\t\t\t\t<\/span>\n\t\t\t\t<div>\n\t\t\t\t\t<p>Merger and acquisition (M&amp;A) activity in the global chemical industry wasn\u2019t too inspiring in 2023. After dropping 16% compared to 2022, global M&amp;A transaction volumes reached their lowest level ...<\/p>\n\t\t\t\t<\/div>\n\t\t\t<\/li>\n            \n            <li>\t\t\t\t<span class=\"title\">\n\t\t\t\t\t<a href=\"http:\/\/www.bing.com\/news\/apiclick.aspx?ref=FexRss&amp;aid=&amp;tid=6646df2e34614c99bda9df48e3bea08c&amp;url=https%3A%2F%2Fwww.forbes.com%2Fsites%2Fdeloitte%2F2024%2F05%2F02%2Fready-or-not-global-chemical-industry-executives-may-need-to-get-prepared-for-a-resurgence-in-merger--acquisition-activity%2F&amp;c=18261931279081048822&amp;mkt=en-us\" rel=\"nofollow\">\n\t\t\t\t\t\tReady Or Not: Global Chemical Industry Executives May Need To Get Prepared For A Resurgence In Merger &amp; Acquisition Activity\n\t\t\t\t\t<\/a>\n\t\t\t\t<\/span>\n\t\t\t\t<div>\n\t\t\t\t\t<p>Merger and acquisition (M&amp;A) activity in the global chemical industry wasn\u2019t too inspiring in 2023. After dropping 16% compared to 2022, global M&amp;A transaction volumes reached their lowest level ...<\/p>\n\t\t\t\t<\/div>\n\t\t\t<\/li>\n            \n            <li>\t\t\t\t<span class=\"title\">\n\t\t\t\t\t<a href=\"http:\/\/www.bing.com\/news\/apiclick.aspx?ref=FexRss&amp;aid=&amp;tid=6646df2e34614c99bda9df48e3bea08c&amp;url=https%3A%2F%2Fwww.morningstar.com%2Fnews%2Fbusiness-wire%2F20240502048586%2Fgladstone-group-study-affirms-the-sweet-spot-most-appealing-to-ria-buyers-over-the-next-12-months&amp;c=143762990650218462&amp;mkt=en-us\" rel=\"nofollow\">\n\t\t\t\t\t\tGladstone Group Study Affirms the Sweet Spot Most Appealing to RIA Buyers Over the Next 12 Months\n\t\t\t\t\t<\/a>\n\t\t\t\t<\/span>\n\t\t\t\t<div>\n\t\t\t\t\t<p>\u201cThe Gladstone Prognosticator\u2122\u201d is the first forward-looking mergers and acquisitions (M&amp;A) research study, providing firms with a consensus opinion on trends that will impact RIA M&amp;A The ...<\/p>\n\t\t\t\t<\/div>\n\t\t\t<\/li>\n            \n            <li>\t\t\t\t<span class=\"title\">\n\t\t\t\t\t<a href=\"http:\/\/www.bing.com\/news\/apiclick.aspx?ref=FexRss&amp;aid=&amp;tid=6646df2e34614c99bda9df48e3bea08c&amp;url=https%3A%2F%2Fwww.news-journal.com%2Fviking-mergers-acquisitions-announces-successful-acquisition-of-admar-diagnostic-instruments-inc-by-pilar-capital%2Farticle_14cee17e-6a4b-5e7e-94e1-bda510944c4a.html&amp;c=552007740206345709&amp;mkt=en-us\" rel=\"nofollow\">\n\t\t\t\t\t\tViking Mergers &amp; Acquisitions Announces Successful Acquisition of Admar Diagnostic Instruments, Inc. by Pilar Capital\n\t\t\t\t\t<\/a>\n\t\t\t\t<\/span>\n\t\t\t\t<div>\n\t\t\t\t\t<p>TAMPA, Fla., May 2, 2024 \/PRNewswire\/ -- Viking Mergers &amp; Acquisitions is pleased to announce the successful acquisition of Admar Diagnostic Instruments, Inc., also known as Admar Neuro ...<\/p>\n\t\t\t\t<\/div>\n\t\t\t<\/li>\n            \n            <li>\t\t\t\t<span class=\"title\">\n\t\t\t\t\t<a href=\"http:\/\/www.bing.com\/news\/apiclick.aspx?ref=FexRss&amp;aid=&amp;tid=6646df2e34614c99bda9df48e3bea08c&amp;url=https%3A%2F%2Fwww.investopedia.com%2Farticles%2Ffundamental-analysis%2F09%2Faccretion-dilution-analysis-mergers.asp&amp;c=5194486366918049460&amp;mkt=en-us\" rel=\"nofollow\">\n\t\t\t\t\t\tHow Accretion\/Dilution Analysis Affects Mergers and Acquisitions\n\t\t\t\t\t<\/a>\n\t\t\t\t<\/span>\n\t\t\t\t<div>\n\t\t\t\t\t<p>Owners and managers of companies are periodically pitched merger and acquisition (M&amp;A) deal proposals. As such, investment bankers, private equity shops, and related companies provide ideas to ...<\/p>\n\t\t\t\t<\/div>\n\t\t\t<\/li>\n            \n            <li>\t\t\t\t<span class=\"title\">\n\t\t\t\t\t<a href=\"http:\/\/www.bing.com\/news\/apiclick.aspx?ref=FexRss&amp;aid=&amp;tid=6646df2e34614c99bda9df48e3bea08c&amp;url=https%3A%2F%2Fwww.idahostatesman.com%2Fpress-releases%2Farticle288131240.html&amp;c=6365693760899818097&amp;mkt=en-us\" rel=\"nofollow\">\n\t\t\t\t\t\tTeam Internet Group PLC Announces Completion of Acquisition of Shinez I.O. Ltd\n\t\t\t\t\t<\/a>\n\t\t\t\t<\/span>\n\t\t\t\t<div>\n\t\t\t\t\t<p>Following the acquisition, the enlarged Group's unaudited pro forma financials for 2023 indicate an estimated gross revenue, net revenue and Adjusted EBITDA of approximately USD 948 million ...<\/p>\n\t\t\t\t<\/div>\n\t\t\t<\/li>\n            <\/ul> <\/div>\n","protected":false},"excerpt":{"rendered":"<p>#mergersandacquisitions #corporatelaw #businesslaw http:\/\/cenkuslaw.com http:\/\/braatenwoods.com In the context of mergers and acquisitions, indemnity clauses encapsulate the extent of liability a seller will assume post-closing based on the representations and warranties they present to the buyer. So, it&#8217;s especially important that sellers of a business carefully consider several factors about the scope of indemnification and how [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":5729,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"spay_email":""},"categories":[9],"tags":[2652,900,2650,2651],"aioseo_notices":[],"jetpack_featured_media_url":"https:\/\/www.austinshortfilm.com\/wp-content\/uploads\/2018\/10\/pnPdfZUGxZU.jpg","_links":{"self":[{"href":"https:\/\/www.austinshortfilm.com\/wp-json\/wp\/v2\/posts\/5728"}],"collection":[{"href":"https:\/\/www.austinshortfilm.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.austinshortfilm.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.austinshortfilm.com\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.austinshortfilm.com\/wp-json\/wp\/v2\/comments?post=5728"}],"version-history":[{"count":0,"href":"https:\/\/www.austinshortfilm.com\/wp-json\/wp\/v2\/posts\/5728\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.austinshortfilm.com\/wp-json\/wp\/v2\/media\/5729"}],"wp:attachment":[{"href":"https:\/\/www.austinshortfilm.com\/wp-json\/wp\/v2\/media?parent=5728"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.austinshortfilm.com\/wp-json\/wp\/v2\/categories?post=5728"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.austinshortfilm.com\/wp-json\/wp\/v2\/tags?post=5728"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}