What a representation actually allocates
Representations and warranties in an M&A agreement are statements of fact about the target, usually made at signing and repeated at closing, covering matters like its financial statements, contracts, compliance, litigation, and taxes. They are less a promise that everything is perfect than a way of deciding who pays if something turns out to be wrong. Qualifiers such as knowledge and materiality narrow a statement, and a seller who negotiates them in is shifting risk back toward the buyer. Buyers often ask for a broad statement that nothing material has been left out, and sellers often resist it. How those few words land usually matters more than the length of the list.
Disclosure schedules and the gaps between them
The disclosure schedules are where the seller lists its exceptions, and that is where much of the negotiating effort quietly goes. An item disclosed against one representation may or may not count against another, depending on how the agreement handles cross-references. Sellers tend to benefit from disclosing broadly and early; buyers benefit from reading every entry as if it will be quoted back to them later, because it often is. Whether a buyer can still bring a claim for a breach it learned about before closing is treated differently from one jurisdiction to another, so many agreements settle the point expressly rather than leave it to the governing law. Whichever side you are on, keep the schedule drafts together with the diligence answers that sit behind them.
Indemnity, insurance, and claims after closing
A breach matters only through the remedy the agreement attaches to it. Many private-company deals set a survival period for claims, a threshold before losses count, and a cap on recovery, with carve-outs for fundamental matters such as title and authority and for fraud. Representations and warranties insurance is now common across many deal sizes, and when a policy is in place the buyer's recovery may run largely to the insurer instead of the seller, subject to the policy's own exclusions. A post-closing claim usually starts with a written notice that must satisfy the agreement's content and timing rules, and those clauses are easy to overlook. Our first conversation usually establishes where your deal stands, whether still in negotiation, signed, or closed, and which of these terms will carry the most weight for you.
