Mergers & Acquisitions

Resources: Glossary

Don’t be confused or intimidated by any terms or abbreviations in the M&A world. You’ll find answers here.

Indemnification

Definition

A provision in the purchase agreement that allows a buyer to seek recourse against the seller for losses suffered due to breaches of representations and warranties (reps & warranties).

See Also

Representations & warranties, purchase agreement.

Tips

The reps & warranties are a hotly debated topic in M&A transactions and are often one of the last hurdles to overcome prior to a successful closing. Indemnification language is often stronger in a stock transaction (vs. asset) because the buyer is bearing more potential risk.

Related Resources

M&A Reps & Warranties | A Complete Guide