Post-Disposition Escrow Negotiation and Settlement

Challenge

A company was sold subject to a $1 MM escrow, as collateral against possible indemnity claims by the buyer.  Buyer made claims amounting to $3.5 MM alleging intentional default. This caused an impasse that prevented the release of the escrow to the seller.

Solution

KMF Consulting was engaged to investigate and resolve the impasse on behalf of the seller and avoid a costly and protracted legal battle. I interviewed company officials and analyzed and reviewed support for claims against the terms of the Stock Purchase Agreement and found the buyer was over-reaching in multiple areas and presented our position to the buyer.  We then quickly negotiated a settlement agreeable to both parties resulting in the return of 60% of the escrow to the seller and a complete release of all current and future claims.