Disclosure letter

A key document in a transaction involving the acquisition of the shares in, or the business and assets of, a private limited company. The disclosure letter is prepared by the seller of the shares or assets, and includes general and specific disclosures regarding the seller's warranties in the acquisition agreement. The buyer will usually agree that the seller will not be liable for a breach of warranty where the matter giving rise to the breach has been disclosed in the disclosure letter. A bundle of documents (either in physical or electronic form, and typically referred to as the disclosure bundle) usually accompanies the disclosure letter to support the seller's disclosures.