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Thursday, January 3, 2019

Startup investors plan for tax demand shield

Indemnity clauses are often part of large funding rounds, or in mergers and acquisitions. But they are normally not part of small fund raises by early-stage startups, corporate lawyers said. An indemnity clause functions like an insurance protection and is worked out between the founder and investor, based on several conditions related to the startup’s operations and long-term plan.

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