Reuters (06/25/14) Lucia Mutikani
Orders for durable goods declined in May, while a measure of capital spending plans increased. Durable goods orders fell 1.0%, according to the U.S. Department of Commerce, partly due to a decline in orders for defense capital goods. Economists surveyed by Reuters had forecast flat orders for May. Nondefense capital goods orders excluding aircraft, an indicator of potential business spending plans, rose 0.7%. Economists had forecast a rise of 0.5%.
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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