Reuters (05/30/13) Jason Lange
The federal government’s spending cuts had a deeper effect on the economy in the first quarter than initially thought. The U.S. economy grew at a 2.4% annual rate, down a tenth of a point from an earlier estimate, according to updated figures from the U.S. Department of Commerce. Many economists forecast that growth will slow midyear as spending cuts go into effect.
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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