Joint and several liability means that if there is more than one seller, the buyer can recover the full amount of a warranty claim from any one of them, regardless of how much of the business that seller actually owned.
Technically, it is a liability structure in which each seller is liable for the whole of any warranty or indemnity claim, not merely their proportionate share. A seller who pays more than their share is left to seek contribution from the other sellers separately, a private problem between sellers rather than the buyer’s concern.
The buyer wants joint and several liability because it gives them one deep pocket to pursue rather than having to chase multiple sellers for partial amounts, some of whom may be harder to recover from than others. Sellers, particularly minority sellers, want the opposite: liability capped at their own proportionate share.
This matters most where the sellers are not equally resourced, such as founders alongside employee shareholders or a retiring partner with a smaller stake. A minority seller under joint and several liability can end up funding a majority seller’s exposure with no guarantee of ever being repaid.
What you as a seller should push back on: joint and several liability where your shareholding is a minority one. If it cannot be avoided entirely, push for a several cap set at your own proportionate share as a backstop.