By Fredrick P. Niemann, Esq. a selling a business lawyer
Many sellers of their business include in their sales contract some sort of indemnification language. Generally speaking, this means that the seller agrees to hold the buyer harmless and release him or her from claims of third parties relating to what the seller did or did not do when they owned the business. Likewise, the buyer holds the seller harmless from claims of third parties for what the buyer does or does not do after the sale concludes.
These indemnification clauses require counsel to look for and rewrite protective variations. For example, if the seller is going to continue as a consultant or even an employee to the business, the indemnification may need to take into account some sort of indemnification obligation. One might decide to define the indemnification obligation as applying to no more than a fixed dollar amount or limit it to a fixed period of time.
Sometimes, a buyer or seller will want to take the position that there should be no indemnification provision clause at all. Often you’ll find such a position when the business is being sold for a relatively small amount that is less than the business is actually worth. In such a case, the seller may insist that it is being sold “as is” and “with all flaws” the same way as distressed real estate. In other words, the price figures in the risk inherent in having no indemnification clause.
Contact me personally today to discuss the sale of your New Jersey business. I am easy to talk to, very approachable and can offer you practical, legal ways to handle your concerns. You can reach me toll free at (855) 376-5291 or e-mail me firstname.lastname@example.org