• Buyer Beware: Disclaiming Reliance in M&A Transactions
  • December 13, 2012 | Authors: Lisa Hedrick; Andrew M. Lohmann
  • Law Firm: Hirschler Fleischer A Professional Corporation - Richmond Office
  • An increasing trend in mergers and acquisitions agreements is the inclusion of a non-reliance or “no other representations” provision (see inset for the latest statistics in transactions involving privately-held targets). Functionally the same, such provisions disclaim or otherwise defeat a buyer’s reliance on any representations made outside of the four corners of the definitive agreement and complement a customary merger clause, which may not fully protect against fraud claims. The basis to include such provisions is to preserve the typically painstakinglydrafted representations and warranties that the parties have agreed to in the final document and not allow outside statements to “undo” specifically negotiated representations.