Associated Press (03/05/15)
Worker productivity in the fourth quarter of 2014 dropped at an annual rate of 2.2%, less than the 1.8% decline estimated one month ago, according to the U.S. Department of Labor. Labor costs increased at a rate of 4.1%, up from estimates of 2.7%. This period of worsening productivity and increasing labor costs is expected to be temporary, experts say, and they do not believe that inflation will become a problem.
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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