Education & Training Deals: Indemnification Done Right
Securities and M&A counsel for independent sponsors drafting education and training transactions, from LOI to close to the capital markets that open up afterward.
Education & Training deals in the lower middle market run a specific playbook. Indemnification is where the structure either holds or starts to leak.
The typical education and training platform sits at $8M to $90M EV with EBITDA in the $2M to $15M range. The thesis runs on private school, training academy, or B2B training platform consolidation. Accreditation continuity is the only thing that matters in the first 30 days post-close.
How Indemnification actually gets structured.
Set general indemnity survival at 18 months, fundamental reps for the full statute of limitations.
Build a basket at 0.5 percent of EV, with a deductible structure, not a tipping basket.
Cap general indemnity at 10 percent of EV, with R&W insurance carrying the layer above.
Carve out fraud, tax, and intentional breach from any cap.
In education and training, layer in accreditor pre-notification calendar set as part of the Indemnification workstream.
Negotiating caps and baskets without first reading the disclosure schedules. The schedules dictate the real exposure.
"Indemnification only matters when the deal goes wrong. Draft it as if it will."Jason Powell · Indemnification
The deal is one thing. The capital that opens up after close is another.
Capital after close is where the IRR actually gets made. The right introductions at month nine through month thirty are where this practice works as hard as it does at the LOI.
Related deal pages.
Transaction Fee Structuring for Education & Training
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Working Capital Adjustments for Education & Training
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Representation & Warranty Insurance for Education & Training
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Quality of Earnings for Education & Training
The buyer's accounting diligence report normalizing earnings, working capital, and pro-forma performance.
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Bring the education and training deal. Get Indemnification done right.
Direct counsel from a securities and M&A attorney with billions in structured transactions, the independent-sponsor-native playbook, and the capital markets network that opens up post-close.