Wall Street Journal (02/06/15) Justin Lahart
U.S. payrolls increased by 257,000 in January, up from the 237,000 forecast by economists. Gross domestic product grew by a 2.6% annual rate during the fourth quarter of 2014, and is expected to expand 2.4% in the first quarter of 2015. The data could indicate that productivity may be contracting but more likely demonstrates that the economy is expanding faster than the current data show.
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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