Reuters (11/04/14)
New orders for U.S. factory goods declined 0.6% in September, the second consecutive month of falling demand, according to the U.S. Department of Commerce. The results were in line with Wall Street’s expectations. Orders for August were slightly revised to a 10.0% decline.
The decline is likely to be short-lived, as new order growth and backlogs saw a strong rebound in October, mostly due to domestic demand.
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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