Guides & Studies

Materiality Scrape Provisions in 2017 and 2018 Private Target M&A Deals With Indemnification Baskets/Deductibles

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A Deal Terms Study, Created Using Kira Machine Learning Contract Analysis Software

This report summarizes our findings on various relationships between materiality scrape provisions and indemnification baskets and/or deductibles. Specifically, we reviewed:

  1. The prevalence of and variation in materiality scrape provisions in private target M&A agreements publicly filed in 2017 and 2018 that include indemnification baskets and/or deductibles;
  2. The association between double materiality scrape provisions and larger indemnification baskets (based on percentage of deal value); and,
  3. The association between the prevalence of double materiality scrape provisions and eligible claim thresholds.

Kira’s state-of-the-art machine learning technology automatically identifies and extracts information from contracts and comes with over 1,000 built-in provision models. A full list of the currently available M&A deal point-related provisions that Kira can identify out of the box can be found at the end of this report.

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