Part 1: Scope of Exposure
Seidman Law Group will be posting a series of pieces on issues that are commonly overlooked as boilerplate provisions. The first topic discusses the scope of exposure for contracting parties. Scope of exposure is a fancy term for allocation of risk: what are the possible damages awards if a contract is breached or becomes impossible […]
Predictions on AI and Procurement
Several people have asked me for my thoughts on how AI will affect procurement. Really. First, I will share what companies are doing right now to implement AI in procurement: • Building centralized AI “governance hubs” to enforce standardized contracting playbooks. • Running tabletop exercises for AI failure scenarios linked back to contractual remedies. • […]
Illinois Law: Use of Proceeds Clauses
This imaginary case serves as a great reminder that precise drafting and prompt enforcement of use‑of‑proceeds covenants can make—or break—a commercial real‑estate loan recovery. CASE FACTS AY Properties, LLC advanced a $2.5 million construction loan to DS Investments, Inc. for the development of a mixed‑use retail property in Chicago, Illinois. Under the loan agreement, disbursements were conditioned strictly […]
All About Earnouts
Earnout Basics An earnout is a transaction mechanism where the buyer agrees to pay additional consideration to the seller post-closing that is contingent on the target’s future performance, milestones, or events. Earnouts serve several crucial purposes in M&A deals: Key Terms in Earnout Negotiations Several critical terms must be decided upon when negotiating an earnout […]
Enforcing Carve-Out or “Bad Boy” Guaranties
Enforcing carve-out or “bad boy” guaranties in real estate loan agreements—especially in Illinois and other jurisdictions that favor lender protections—requires a strategic blend of contract clarity, trigger precision, and procedural discipline. Here’s how to do it effectively: First, the guaranty must be clearly drafted, with carve-out events precisely defined. Courts have upheld full recourse liability […]
Key Legal Issues in Real‑Estate Loan Defaults
Both lenders and borrowers–no matter how sophisticated they are or how much artificial intelligence they may use–often need reminders of the key issues they need to think about. Are There Any Event of Default & Acceleration Clauses?Most commercial loans define specific “events of default” (e.g., missed payment, breach of a covenant, insolvency). Upon default, lenders […]
Drafting Carve-Out or “Bad Boy” Guaranties
Drafting effective carve-out or “bad boy” guaranties—especially in Illinois or similar jurisdictions—requires a careful balance between lender protection and guarantor fairness. Here are some nuanced tips to help you structure them strategically: Start with precise definitions. Avoid vague terms like “waste” or “bad acts” unless they’re clearly defined. Courts have interpreted ambiguous carve-outs as triggers […]
Case Update: Post-Closing Litigation
In Northern Data AG v. Riot Platforms, Inc., a Delaware court dealt with a case in which the parties disagreed on the final price and submitted several issues to an accounting expert. The expert resolved four issues in favor of the Buyer. To no surprise, the Seller then ran to court. For two of the four […]
Extreme Heat and Manufacturing/Distribution Agreements
I have been asked several questions recently about this issue for obvious reasons. Rather than bore you in one blog post, I decided to bore you in two blog posts. 1. Definitions & Scope 2. Manufacturing-Phase Obligations 3. Distribution-Phase Protections 4. Force Majeure & Excusable Performance 5. Indemnities, Warranties & Liability Caps Clause Type Purpose […]
Getting Ready for the Get Ready: Selling a Business
I hope the cheesy photo grabbed your attention because overlooking key legal aspects of an M&A deal can lead to delays, disputes, or even derail the deal entirely. Here’s a breakdown of the most important legal considerations: 🧾 1. Business Structure and Ownership 📑 2. Due Diligence Preparation 📜 3. Contracts and Assignability 🧠 4. […]
