Wall Street Journal (06/09/14) Eric Morath
The U.S. has regained all the jobs lost since the recession began in late 2007. Economists note that there are fewer jobs in manufacturing and construction and more jobs in food service, retail, and temporary help. Overall, the workforce participation rate has shrunk to 62.8%, down from 66.2% at the beginning of 2008 and near its lowest level since the late 1970s.
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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