Indemnification and Advance Payment

Reimbursed at the End

Indemnification obligations do not arise until there is some determinable amount that a party is obligated to indemnify. The fact that a party has an indemnification right does not mean they will get reimbursed for their expenses or losses (especially defense costs and attorney fees) until after there is an actual out-of-pocket expense that is found to be covered by the contract language. In other words, you do not get reimbursed until the end.

Example in Corporate Setting

An […]

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What is this Indemnification Provision in my Contract?

Definition

Indemnification is the action of protecting (someone) by promising to pay for the cost of possible future damage, loss, or injury. In a contract setting, it is a provision where one party promises to pay the costs of potential future liabilities incurred by the other party as a result of some defined set of circumstances that might occur because of the contractual arrangement.

Examples

The most common example of an indemnification agreement is an insurance policy. In an insurance policy contract, […]

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Growth by Acquisition – Risks and Benefits

One way a business can grow is to acquire existing business assets. Those business assets might be client lists, existing contracted accounts, intellectual property, trademarks, real estate, income producing assets, capital investments, infrastructure, and so on.

Acquisitions raise a lot of potential risks and benefits. Often there are questions related to the proper valuation of the assets in question, how a purchase will be financed, how the assets will be integrated into the existing business, how roles and authority will […]

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Insurance for the Business

In previous discussions regarding running a business out of your home, we highlighted insurance issues that should be addressed.  This post goes into a little more detail on these issues.

Finding Business Insurance

The first step is to find a source for business insurance.  It is generally best to work with an insurance agent who represents multiple insurance companies so they can help you to find the best insurance policies, at the best price, for the particular needs you have.  You should […]

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It’s Sometimes Necessary to Blow Up a Deal

I’ve heard it said that there are two kinds of lawyers in a deal: ones that get the deal done, and ones that essentially obstruct the deal.  I want to be a lawyer who gets deals done.

However, a key part of the role of a lawyer is to give their client’s the advice that helps them understand all of the key risks, as well as the potential benefits, of a deal.  And sometimes this means providing an objective analysis, and […]

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