Meant to reduce transactional risk, basket deductibles are paid for losses accrued due to various types of risk.
Specifying the instances in which the seller in a transaction can be responsible for various claims, a basket deductible will limit the obligations of an indemnifying party so that they are not liable for breaches or mistakes in a transaction until a specified amount of losses are exceeded.
If a company undergoes an acquisition or merger, the basket deductible will typically be found in the purchase agreement. The presence of a basket deductible will make easier the merger or acquisition process by enumerating the various risks involved, and offering a certain level of insurance to the seller.
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Finance: What is a Commitment Letter?5 Views
Finance a la shmoop what is a commitment letter? dear Rebecca it's been fun and
all but asking me to move in with you was a real turnoff so uh have a nice [Rebecca reading letter]
life yeah that would be a fear of commitment letter I know that one well
well so what's a commitment letter then all right well you need dough but you
don't need it today you need it in six months when construction is finished on
your cabin by the lake at that point you'll convert your very expensive
building loan into a normal mortgage well you can go to the bank and for a [Man walks into bank]
small ish fee get a commitment letter from them which stipulates that assuming
nothing material changes between now and then you will in fact then get a loan
for one hundred fifty two thousand dollars at 5 percent fixed interest rate
for 30 years the bank is then committed to giving you that loan when you know [Contract stamped with committed]
eventually you need it that way you don't have to worry about your bank you
know breaking up with you which is nice because it's tough getting
the It's not you it's me speech from a guy in a bowtie [Man wearing bow tie talking to a man in the bank]
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