Representations and warranties
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Representations and warranties Start Comparison
Materiality in representations — how is it quantified (e.g., by a USD amount)?

Frequency/market practice: Very common. Materiality qualifiers are commonly seen but are rarely quantified (other than specific warranties, e.g., contract value).

How is knowledge qualified (e.g., specific people, actual/constructive knowledge)?

Frequency/market practice: Knowledge qualifiers are primarily based on constructive knowledge (after due inquiry), although an actual knowledge standard is sometimes used. Knowledge is commonly limited to a list of persons or group of persons (typically, specific officers or directors of the target company) specified in the transaction document.

Is a warranty that there is no materially misleading/omitted information common?

Frequency/market practice: Rarely. It is uncommon for a seller to make a representation that none of the target's representations or warranties made in the acquisition agreement or disclosure schedules contain any materially misleading or omitted statement.

Is disclosure of the data room common?

Frequency/market practice: Rarely. Disclosure of the data room is not a common practice in the US.