New York Times (02/02/12)
Construction spending rose 1.5% in December, marking the fifth consecutive monthly gain, reported the U.S. Commerce Department. Builders spent on homes and other projects at a seasonally adjusted annual rate of $816.4 billion, the highest level in 20 months. For 2011, outlays on building projects totaled just $787.4 billion, down 2% from 2010 and roughly half the level that economists deem as healthy.
Buyers of a business generally expect sellers to be responsible for certain liabilities relating to when the seller owned its business—a concept mergers and acquisitions professionals refer to as indemnification. Indemnification is one of the most heavily negotiated, and potentially most significant, provisions of a purchase agreement, and understanding the terminology common to such agreements is essential when negotiating a deal. Attorney Paul Pincus of Ortoli Rosenstadt LLP explains what sellers are liable for, how a seller’s liability may be limited, and how buyers may seek to fund potential indemnity claims.
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