Bloomberg (08/01/14) Victoria Stilwell
Consumer spending accelerated in June by the most in three months, signaling that continued job growth likely will shore up the economy. Household purchases rose 0.4% after a 0.3% gain in May that was larger than previously estimated, according to the U.S. Department of Commerce. The gain coincided with the forecast of 74 economists in a Bloomberg survey.
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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