Wall Street Journal (04/30/14) Victoria McGrane; Jon Hilsenrath
Following the two-day meeting of the Federal Open Market Committee, the U.S. Federal Reserve says it will reduce its bond purchases to $45 billion per month and that economic growth is starting to pick up after the harsh winter. The Fed also will maintain its guidance on short-term interest rates, which will remain near zero for a “considerable time” after the bond buying program ends later this year.
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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