Reps and Warranties: Where Technical Risk Hides in the Purchase Agreement

The technical section of a purchase agreement is short and consequential. Sellers frequently sign representations broader than anything their own team has verified.

Clauses that carry technical exposure

• Ownership of and title to all intellectual property
• Absence of open-source obligations affecting proprietary code
• No known security incidents or unremediated vulnerabilities
• Sufficiency of assets to operate the business as conducted

Each should be qualified by a disclosure schedule that reflects what diligence actually found. Unqualified language converts an operational issue into a personal one.