Baskets and Escrow in Business Transactions

Thank you

Thank you for joining us today.

Description

Identifying and hedging the risk of the unknown is one of the biggest risks in business documentation. If unknown liabilities arise – or known liabilities are greater than anticipated –parties want recourse to address the economic loss. "Caps" and "baskets" are used to address this problem.

"Caps" are the the total amount for which one party may be liable to the other party post-closing. "Baskets" are the amount of loss one party must incur, if any, before seeking recourse to the other party. The variations and interplay between caps and baskets can be highly complex.

This program provides a practical guide to the uses, types, and drafting traps of caps and baskets in business transactions.

Types of "baskets" – "tipping baskets" v. "true deductibles" v. hybrids
Negotiating "caps" – aggregates limits, specific carve-outs for fraud and other bad acts
Intricate relationship between baskets and caps
Drafting to reduce risk of dispute and enhance collectability of claims
Use of escrow to ensure payment of indemnification claims

Contributors

Steven O. Weise

Steven O. Weise is a partner in the Los Angeles office Proskauer Rose, LLP, where his practice encompasses all areas of commercial law. He has extensive experience in financings, particularly those secured by personal property. He also handles matters involving real property anti-deficiency laws, workouts, guarantees, sales of goods, letters of credit, commercial paper and checks, and investment securities. Mr. Weise formerly served as chair of the ABA Business Law Section. He has also served as a member of the Permanent Editorial Board of the UCC and as an Advisor to the UCC Code Article 9 Drafting Committee. Mr. Weise received his B.A. from Yale University and his J.D. from the University of California, Berkeley, Boalt Hall School of Law.

Click here for more information about Steven.

Thank you

Description

Contributors

Steven O. Weise