Indemnifiable Damage Threshold; Other Limitations. (a) Notwithstanding anything to the contrary contained herein, no Indemnified Person may make a claim in respect of any claim for Indemnifiable Damages arising out of, resulting from or in connection with the matters listed in Sections 9.1(a)(i) or 9.1(a)(ii) (other than claims arising out of, resulting from or in connection with (i) fraud or intentional misrepresentation by or on behalf of Seller or the Company or (ii) any failure of any of the Special Representations (as defined below) to be true and correct as aforesaid) unless and until a Claim Certificate (together with any other delivered Claim Certificates) describing Indemnifiable Damages in an aggregate amount greater than $2,000,000 with respect to claims for Indemnifiable Damages arising out of, resulting from or in connection with the matters listed in Sections 9.1(a)(i) or 9.1(a)(ii) (the “Basket”) has been delivered, in which case the Indemnified Person may make claims for indemnification, compensation and reimbursement for all Indemnifiable Damages (including the amount of the Basket). The Basket shall not apply to any other Indemnifiable Damages or claims therefor. (b) If the Transaction is consummated, the maximum liability of Seller and the Company under this Agreement for Indemnifiable Damages arising out of, resulting from or in connection with the matters listed in Sections 9.1(a)(i) or 9.1(a)(ii), except (i) in the case of fraud or intentional misrepresentation by or on behalf of Seller or the Company and (ii) any failure of any of the representations and warranties made by (A) the Company in Section 2.1 (Organization, Standing, Power and Subsidiaries), Section 2.2 (Capitalization), Section 2.3(a) (Authority; Non-contravention), Section 2.11 (Taxes), or (B) the Company in any certificate delivered to Buyer pursuant to this Agreement that are within the scope of those covered by the foregoing Sections (collectively, the “Special Representations”) to be true and correct as aforesaid, shall equal $20,000,000. From and after the Closing, the indemnification procedures set forth in this Article IX shall represent the sole and exclusive remedy for all claims by the Indemnified Persons in connection with this Agreement and the transactions contemplated hereby; provided that nothing in this Agreement shall limit the right of any Indemnified Person to specific performance or other equitable remedies. (c) In the case of any claims for Indemnifiable Damages arising out of, resulting from or in connection with the failure of any of the Special Representations to be true and correct as aforesaid or the matters listed in Sections 9.1(a)(iii), 9.1(a)(iv), 9.1(a)(v), 9.1(a)(vi) or 9.1(a)(vii) (collectively, “Fundamental Claims”), Seller shall have Liability for the amount of any Indemnifiable Damages resulting therefrom, subject to the limitations herein. Notwithstanding anything to the contrary contained herein, the total liability of Seller for all claims under this Agreement, taken as a whole, other than in the case of fraud or intentional misrepresentation by Seller or the Company (for which total liability shall be uncapped) shall be limited to the Purchase Price. (d) Notwithstanding anything to the contrary contained herein, (i) Seller shall not have any right of indemnification, compensation, reimbursement, contribution or right of advancement from Buyer or any other Indemnified Person with respect to any Indemnifiable Damages claimed by any Indemnified Person or any right of subrogation against the Company with respect to any indemnification, compensation or reimbursement of an Indemnified Person by reason of any of the matters set forth in Section 9.1(a), (ii) the rights and remedies of the Indemnified Persons after the Closing shall not be limited by (x) any investigation by or on behalf of, or disclosure to (other than in the Company Disclosure Letter with respect to Sections 9.1(a)(i) and 9.1(a)(ii), subject to any limitations expressly set forth therein), any Indemnified Person at or prior to the Closing regarding any failure, breach or other event or circumstance or (y) any waiver of any condition to the Closing related thereto and (iii) if an Indemnified Person’s claim under this Article IX may be properly characterized in multiple ways in accordance with this Article IX such that such claim may or may not be subject to different limitations depending on such characterization, then such Indemnified Person shall have the right to characterize such claim in a manner that maximizes the recovery and time to assert such claim permitted in accordance with this Article IX. (e) All Indemnifiable Damages shall be calculated net of the amount of any actual recoveries actually received by an Indemnified Person prior to the final resolution of the associated claim under any existing insurance policies and contractual indemnification or contribution provisions (in each case, calculated net of any actual collection costs and reserves, expenses, deductibles or premium adjustments or retrospectively rated premiums (as determined in good faith by an Indemnified Person) incurred or paid to procure such recoveries) in respect of any Indemnifiable Damages suffered, paid, sustained or incurred by any Indemnified Person; provided that no Indemnified Person shall have any obligation to seek to obtain or continue to pursue any such recoveries, except to the extent expressly provided in Section 9.2(f). (f) Prior to making any claim for Indemnifiable Damages for any Sales Taxes, the Indemnified Persons agree to use best efforts to obtain recoveries, or provide proof of payment (or lack thereof), from each applicable venue, customer or distributor for such Taxes. For purposes of the foregoing sentence, “best efforts” shall be deemed satisfied by the Indemnified Persons with respect to any particular venue, customer or distributor if an officer of the Buyer certifies in writing to the Seller (and provides evidence reasonably satisfactory to Seller) that the Buyer (or any of its Affiliates, employees or agents) has performed each of the following actions: (1) the Buyer (or any of its Affiliates, employees or agents) shall have requested in writing, at least two times, by certified mail to such venue, customer or distributor a confirmation that the applicable Taxes have not been paid and a recovery payment in the amount of such Taxes, (2) the Buyer (or any of its Affiliates, employees or agents) shall have investigated public records to determine whether the venue, customer or distributor continues to operate as a going concern, and (3) the Buyer (or any of its Affiliates, employees or agents) shall have engaged a third party collection agent to seek recovery of the applicable Taxes from such venue, customer or distributor; provided, however, with respect to such Taxes in excess of $100,000 (determined on a cumulative basis) with respect to any venue, customer or distributor, (i) “best efforts” shall further require that the Buyer and the Seller have consulted in good faith to determine the extent to which additional steps may be appropriate to recover such amounts and the Buyer shall have taken any such additional steps, and (ii) in the event that Buyer and Seller cannot agree on such additional steps, then Buyer shall have the right to make a claim for Indemnifiable Damages for such Taxes and Seller shall have the right in its sole discretion to pursue any additional steps (including litigation) to recover such Taxes at its own expense and solely for its own benefit, and in such event Buyer agrees to cooperate to the extent requested by Seller with respect to such additional steps. Notwithstanding anything to the contrary in this Agreement, the costs and expenses of performing the steps described in clause (3) and clause (i) of the proviso of the preceding sentence shall be borne 50% by the Buyer and 50% by the Seller (as Indemnifiable Damages). In addition, the Indemnified Persons agree to consult in good faith with the Seller at the Seller’s request regarding the Indemnified Persons’ efforts to recover any such Taxes, obtain proof of payment, and/or obtain written certifications from such venues, customers or distributors, and shall consider the Seller’s comments with respect to such efforts in good faith. Any amounts recovered from or confirmed to have been paid by any venue, customer or distributor shall not be eligible for recovery as Indemnifiable Damages hereunder.
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Samples: Membership Interest Purchase Agreement (Eventbrite, Inc.), Membership Interest Purchase Agreement (Pandora Media, Inc.)
Indemnifiable Damage Threshold; Other Limitations. (a) Notwithstanding anything to the contrary contained herein, no Indemnified Person may make a claim in respect of any claim for Indemnifiable Damages arising out of, resulting from or in connection with the matters listed in Sections 9.1(a)(i) or 9.1(a)(ii) Purchaser (other than claims arising out of, resulting from or in connection with (i) fraud or intentional misrepresentation by on its behalf or on behalf of Seller or the Company or other Indemnified Persons) shall be entitled to set off up to three million five hundred thousand U.S. Dollars (ii) any failure of any of the Special Representations (as defined below) to be true and correct as aforesaid) unless and until a Claim Certificate (together with any other delivered Claim Certificates) describing Indemnifiable Damages in an aggregate amount greater than $2,000,000 with respect to claims for Indemnifiable Damages arising out of, resulting from or in connection with the matters listed in Sections 9.1(a)(i) or 9.1(a)(ii3,500,000) (the “Basket”"Maximum Set-off Amount") has been delivered, in which case due to the Indemnified Person may make claims for indemnificationPersons pursuant to and in accordance with this ARTICLE 9 against a portion of the Deferred Payment and, compensation subject to Sections 9.3, 9.4(b) and reimbursement for all 10.1, the Contingent Payment, if any, payable by Purchaser to the Company Securityholders pursuant to this Agreement against Indemnifiable Damages (including the amount of the Basket"Set-off Right"). The Basket amount set off by Purchaser pursuant to the Set-off Right shall not apply be referred to any other Indemnifiable Damages or claims thereforas the "Set-off Amount".
(b) If the Transaction Share Purchase is consummated, recovery by way of the maximum liability Set-off Right shall constitute the sole and exclusive monetary remedy of Seller and the Company Indemnified Persons for the indemnity obligations under this Agreement for Indemnifiable Damages arising out of, resulting from or in connection with the matters listed in Sections Section 9.1(a)(i) or 9.1(a)(iiand (ii) (the “General Indemnification Cap”), except (i) in the case of fraud or intentional misrepresentation by or on behalf of Seller or the Company and (ii) any failure of any of the representations and warranties made by (A) the Company contained in Section 2.1 (Organization, Standing, Power and Subsidiaries), Section 2.2 (CapitalizationCapital Structure), Section 2.3(a) 2.3 (Authority; Non-contraventionNoncontravention), Section 2.11 2.9 (Intellectual Property), subject to the IP Infringement Qualifier, Section 2.10 (Taxes), or Section 3.1 (BPower and Capacity), Section 3.2 (Enforceability; Noncontravention), Section 3.3 (Title to Shares and Section 3.5 (Securities Laws) (to the Company in any certificate delivered to Buyer extent such failure would negatively impact an exemption from registration of the issuance of Purchaser Ordinary Shares pursuant to this Agreement that are within the scope of those covered by the foregoing Sections applicable securities laws) (collectively, the “Special Representations”) to be true and correct as aforesaid, shall equal $20,000,000. From aforesaid and after (ii) the Closingmatters listed in clauses (iii) – (xi) of Section 9.1(a) (clauses (i) and (ii) collectively, the indemnification procedures set forth in this Article IX shall represent the sole and exclusive remedy “Fundamental Claims”), for all claims by which the Indemnified Persons shall first have the right to obtain indemnification by way of the Set-off Right, and second, bring a claim against the Indemnifying Parties, all in connection accordance with this Agreement and the transactions contemplated hereby; provided that nothing in this Agreement shall limit the right of any Indemnified Person to specific performance or other equitable remediesARTICLE 9.
(c) In the case of any claims for Indemnifiable Damages arising out ofFundamental Claim and subject to Section 9.1(b), resulting from after Purchaser (on behalf of itself or in connection with other Indemnified Persons) shall have set off the failure of any Maximum Set-off Amount by way of the Special Representations to be true and correct as aforesaid or Set-off Right (after taking into account all other claims made by way of the matters listed Set-off Right) (in Sections 9.1(a)(iiithe case of a Fundamental Claim during the Set-off Period), 9.1(a)(iv), 9.1(a)(v), 9.1(a)(vi) or 9.1(a)(vii) (collectively, “Fundamental Claims”), Seller each Indemnifying Party shall have Liability be liable for such Person’s Pro Rata Share of the amount of any Indemnifiable Damages resulting therefrom; provided, subject to however, that such liability shall be limited to: (i) in case of breach of the limitations herein. Notwithstanding anything to representations and warranties contained in Section 2.9, 60% of such Person’s Pro Rata Share of the contrary contained hereinAggregate Consideration actually received by such Indemnifying Party, and (ii) in case of other Fundamental Claims, such Person’s Pro Rata Share of the total liability of Seller for all claims under this AgreementAggregate Consideration actually received by such Indemnifying Party, taken as a whole, other than except that in the case of fraud or intentional misrepresentation a breach of any of the representations and warranties contained in Section 3.3 (Title to Shares), such Person’s Pro Rata Share of the Aggregate Consideration plus the reasonable fees and expenses and other costs incurred by Seller or the Company (for which total liability shall be uncapped) shall be limited Purchaser to the Purchase Pricecure such breach.
(d) Notwithstanding anything contained herein to the contrary contained hereinand subject to limitations set forth in clauses (b) and (c) above, in no event shall the maximum aggregate liability of all the Indemnifying Parties together under this Agreement exceed the Aggregate Consideration actually paid to the Indemnifying Parties (i) Seller shall not have any right of indemnificationother than, compensation, reimbursement, contribution or right of advancement from Buyer or any other Indemnified Person with respect to such Indemnifying Party, for any Indemnifiable Damages claimed fraud committed by any Indemnified Person such Indemnifying Party or any right of subrogation against the Company with respect to any indemnification, compensation or reimbursement of an Indemnified Person by reason of any as a result of the matters set forth in final clause of Section 9.1(a9.2(c), (ii) the rights and remedies of the Indemnified Persons after the Closing shall not be limited by (x) any investigation by or on behalf of, or disclosure to (other than in the Company Disclosure Letter with respect to Sections 9.1(a)(i) and 9.1(a)(ii), subject to any limitations expressly set forth therein), any Indemnified Person at or prior to the Closing regarding any failure, breach or other event or circumstance or (y) any waiver of any condition to the Closing related thereto and (iii) if an Indemnified Person’s claim under this Article IX may be properly characterized in multiple ways in accordance with this Article IX such that such claim may or may not be subject to different limitations depending on such characterization, then such Indemnified Person shall have the right to characterize such claim in a manner that maximizes the recovery and time to assert such claim permitted in accordance with this Article IX.
(e) All Indemnifiable Damages shall be calculated net Notwithstanding anything contained herein to the contrary, for purposes of computing the amount of any actual recoveries Indemnifiable Damages incurred, there shall be deducted an amount equal to the amount of:
(i) any insurance proceeds actually received by an Indemnified Person from any third-party insurer in connection with such Indemnifiable Damages prior to the final resolution end of the associated claim under any existing insurance policies and contractual indemnification applicable Set-off Period;
(ii) indemnity or contribution provisions amounts actually received from third parties (in each case, calculated net of applicable costs of recovery or collection thereof) prior to the end of the applicable Set-off Period; and
(iii) any actual collection costs and reservesTax benefit actually realized as a result of the Indemnifiable Damages, expensesi.e., deductibles the amount of Tax then required to be paid has been reduced below the amount of Tax that otherwise would have been payable but for the deductibility of, or premium adjustments other Tax benefit arising from, such Indemnifiable Damages.
(f) Other than in the case of the Specified Litigation Matters, the Indemnifying Parties shall not be obligated or retrospectively rated premiums required to make any indemnification payment nor would they be subject to any liability pursuant to clause (i) of Section 9.1(a) until such time as determined in good faith by an Indemnified Person) incurred or paid to procure such recoveries) in respect the total amount of any all Indemnifiable Damages suffered, paid, sustained that have been suffered or incurred by any Indemnified Person; provided that no Persons exceeds an amount equal to $200,000 (the “Basket Amount”). If the total amount of such Indemnifiable Damages exceeds the Basket Amount, then the Indemnified Person Persons shall have any obligation be entitled to seek to obtain or continue to pursue any be indemnified against and compensated and reimbursed for the entire amount of such recoveriesIndemnifiable Damages, except to including the extent expressly provided in Section 9.2(f)Basket Amount.
(fg) Prior Notwithstanding anything herein to making the contrary, nothing in this Agreement shall limit Purchaser's right to specific performance or injunctive relief, or any right or remedy arising by reason of any claim for Indemnifiable Damages for any Sales Taxes, of fraud or intentional misrepresentation with the Indemnified Persons agree to use best efforts to obtain recoveries, or provide proof of payment (or lack thereof), from each applicable venue, customer or distributor for such Taxes. For purposes of the foregoing sentence, “best efforts” shall be deemed satisfied by the Indemnified Persons with respect to any particular venue, customer or distributor if an officer of the Buyer certifies in writing to the Seller (and provides evidence reasonably satisfactory to Seller) that the Buyer (this Agreement or any of its Affiliates, employees or agents) has performed each of the following actions:
(1) the Buyer (or any of its Affiliates, employees or agents) shall have requested in writing, at least two times, by certified mail to such venue, customer or distributor a confirmation that the applicable Taxes have not been paid and a recovery payment in the amount of such Taxes, (2) the Buyer (or any of its Affiliates, employees or agents) shall have investigated public records to determine whether the venue, customer or distributor continues to operate as a going concern, and (3) the Buyer (or any of its Affiliates, employees or agents) shall have engaged a third party collection agent to seek recovery of the applicable Taxes from such venue, customer or distributor; provided, however, with respect to such Taxes in excess of $100,000 (determined on a cumulative basis) with respect to any venue, customer or distributor, (i) “best efforts” shall further require that the Buyer and the Seller have consulted in good faith to determine the extent to which additional steps may be appropriate to recover such amounts and the Buyer shall have taken any such additional steps, and (ii) in the event that Buyer and Seller cannot agree on such additional steps, then Buyer shall have the right to make a claim for Indemnifiable Damages for such Taxes and Seller shall have the right in its sole discretion to pursue any additional steps (including litigation) to recover such Taxes at its own expense and solely for its own benefit, and in such event Buyer agrees to cooperate to the extent requested by Seller with respect to such additional steps. Notwithstanding anything to the contrary in this Agreement, the costs and expenses of performing the steps described in clause (3) and clause (i) of the proviso of the preceding sentence shall be borne 50% by the Buyer and 50% by the Seller (as Indemnifiable Damages). In addition, the Indemnified Persons agree to consult in good faith with the Seller at the Seller’s request regarding the Indemnified Persons’ efforts to recover any such Taxes, obtain proof of payment, and/or obtain written certifications from such venues, customers or distributors, and shall consider the Seller’s comments with respect to such efforts in good faith. Any amounts recovered from or confirmed to have been paid by any venue, customer or distributor shall not be eligible for recovery as Indemnifiable Damages hereunderother ancillary agreements.
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