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Company acquisitions: representations warranties and disclosure

January 28, 2014

By ROSS MCNAUGHTON & MATTHEW POXON

In any business or company acquisition, the principle of caveat emptor (buyer beware) applies. A buyer can receive contractual assurances from the seller as to the assets and liabilities of the business or company, which give a certain level of comfort and recourse to a buyer in the event that those assurances turn out to be untrue, incomplete or misleading. These assurances generally take the form of representations and/or warranties, and are discussed here.