Wall Street Journal (03/16/12) Neil Shah
The number of people filing new applications for unemployment benefits declined last week, but declines in the four-week moving average have slowed, indicating that recent improvements in the job market may be losing momentum. Although employers are slowing the pace of layoffs, and the economy has added 1.2 million jobs in the past six months, some observers believe the job market won’t improve any further without more substantial economic growth.
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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