Risk Allocation in Healthcare Mergers and Acquisitions

Healthcare merger and acquisition deals continue to be strong in 2017. Healthcare counsel on both sides of a deal must identify the potential indemnification and liability issues that may arise and plan accordingly.

Counsel can address indemnification in representations and warranties, baskets, caps, and escrow provisions. For example, counsel can craft indemnification provisions with caps on recovery amounts, as well as limits on reps and warranties survival periods, and tailor an indemnification structure to the risks of the particular deal.

Indemnification provisions allow the parties to contractually shift risk and reduce liability exposure. Effective indemnification clauses clearly outline risks that are indemnified, exclusions from indemnity, and procedures for making an indemnification claim. Differing state laws may affect certain aspects of these provisions.

Listen as our authoritative panel of healthcare attorneys discusses best practices for drafting and negotiating representations, warranties, and indemnities in healthcare M&As. The panel will discuss the use of caps and baskets and provide strategies for avoiding common negotiation and enforcement pitfalls and resolving contract disputes.

1. Reps and warranties in healthcare M&As
2. Indemnities in healthcare M&As
3. Use of caps and baskets
4. Strategies for avoiding pitfalls and resolving contract disputes

The panel will review these and other key issues:

• What are commonly negotiated warranty and indemnification provisions in healthcare M&As?
• What issues are often disputed when negotiating these provisions? What are effective strategies for resolving them?
• What approaches should counsel use to protect a client’s interests when negotiating an indemnification provision?