INDEMNIFICATION AND PAYMENT OF DAMAGES BY SELLERS Sellers, jointly and severally, will indemnify and hold harmless Buyer, the Company, and their respective representatives, stockholders, controlling persons, and affiliates (collectively, the "Indemnified Persons") for, and will pay to the Indemnified Persons the amount of, any loss, liability, claim, damage (including incidental and consequential damages), expense (including costs of investigation and defense and reasonable attorneys' fees) or diminution of value, whether or not involving a third-party claim (collectively, "Damages"), arising, directly or indirectly, from or in connection with:
(a) any and all loss, liability or damage suffered or incurred by Buyer in respect of any debt, obligation or liability of the Company or of Seller not disclosed in this Agreement, any of the Exhibits attached hereto, or in writing to Buyer prior to the Closing Date;
(b) any breach of any representation or warranty made by Sellers in this Agreement, the Exhibits attached hereto, or any other certificate or document delivered by Sellers pursuant to this Agreement;
(c) any breach of any representation or warranty made by Sellers in this Agreement as if such representation or warranty were made on and as of the Closing Date;
(d) any Breach by either Seller of any covenant or obligation of such Seller in this Agreement;
(e) any claim by any Person for brokerage or finder's fees or commissions or similar payments based upon any agreement or understanding alleged to have been made by any such Person with either Seller or the Company (or any person acting on their behalf) in connection with any of the transactions contemplated hereby. The remedies provided in this Section 9.2 will not be exclusive of or limit any other remedies that may be available to Buyer or the other Indemnified Persons.
INDEMNIFICATION AND PAYMENT OF DAMAGES BY BUYER Buyer will indemnify and hold harmless Sellers, and will pay to Sellers the amount of any Damages arising, directly or indirectly, from or in connection with (a) any Breach of any representation or warranty made by Buyer in this Agreement or in any certificate delivered by Buyer pursuant to this Agreement, (b) any Breach by Buyer of any covenant or obligation of Buyer in this Agreement, or (c) any claim by any Person for brokerage or finder's fees or commissions or similar payments based upon any agreement or understanding alleged to have been made by such Person with Buyer (or any Person acting on its behalf) in connection with any of the Contemplated Transactions.
Indemnification by Sellers Subject to the other terms and conditions of this ARTICLE 10 and the terms and conditions set forth in ARTICLE 13, Sellers, severally and not jointly (pro rata in accordance with the portion of the Purchase Price received by each Seller), shall indemnify, defend, reimburse and hold harmless Buyer, its Affiliates, successors and assigns and the respective officers, directors, employees, attorneys, agents and stockholders of the foregoing (the “Buyer Indemnified Parties”) from and against any and all Losses incurred or sustained by, or imposed upon, such Buyer Indemnified Party based upon, arising out of, with respect to, relating to or by reason of:
(a) any inaccuracy in or breach of any of the representations or warranties of Sellers contained in ARTICLE 2 hereunder or the Company in ARTICLE 3, provided that no Seller shall have any obligation hereunder with respect to any inaccuracy in or breach of any of the representations and warranties of any other Seller;
(b) any breach or non-fulfillment of any covenant, agreement or obligation to be performed by Sellers pursuant to this Agreement;
(c) any Company Transaction Expenses or Indebtedness outstanding as of the Closing to the extent not paid or satisfied by the Company or Sellers at or prior to the Closing;
(d) any Taxes for the Pre-Closing Tax Period (including the pre-Closing portion of any Straddle Period) to the extent not included in the computation of Company Transaction Expenses or Closing Net Working Capital (collectively, “Pre-Closing Taxes”), to the extent that such Taxes have not been reimbursed under a claim made under the R&W Insurance Policy; or
(e) any of the matters set forth on Section 10.1(e) of the Buyer Disclosure Schedule. Any claims arising out of clauses (b), (c), (d), or (e) of this Section 10.1 are referred to herein as “Excluded Claims.”
Indemnification by Seller As an inducement to Buyer to enter into this Agreement and the Related Documents, and acknowledging that Buyer is relying on the indemnification provided in this Section 7 in entering into this Agreement and the Related Documents, Seller and Parent, jointly and severally, agree, to indemnify, defend and hold harmless Buyer and its affiliates, parent corporation and subsidiaries, and their respective employees, officers, directors, representatives, agents, counsel, successors and assigns (collectively, "Buyer Affiliates"), from and against any claims, losses, liability, obligations, lawsuits, judgments, settlements, governmental investigations, deficiencies, damages, costs or expenses of whatever nature, whether known or unknown, accrued, absolute, contingent or otherwise including, without limitation, interest, penalties, attorneys' fees, costs of investigation and all amounts paid in defense or settlement of the foregoing, reduced by and to the extent of any insurance proceeds received with respect to any of the foregoing (collectively "Claims and Losses"), suffered or incurred by Buyer or Buyer Affiliates as a result of or in connection with the following: (i) any and all debts, liabilities and obligations of Seller or related to the Assets (other than the Assumed Liabilities), whether known or unknown, accrued, absolute, contingent or otherwise, arising out of or relating to the business and operations of Seller or related to the Assets prior to or on the Closing Date or which arise after the Closing Date but which are based upon or arise out of any act, transaction, circumstance, state of facts or other condition which occurred or existed on or before the Closing Date, whether or not then known, accrued, due or payable; (ii) a breach of any obligation, representation, warranty, covenant or agreement of Seller or Parent in this Agreement or any Related Document, or because any representation or warranty by Seller and Parent contained in this Agreement or any Related Document, in any document furnished or required to be furnished pursuant to this Agreement by Seller or Parent to Buyer or any of its representatives, or any documents furnished to Buyer in connection with the Closing hereunder, shall be false; (iii) any litigation arising out of or based upon events or operative facts occurring prior to or on the Closing Date, in connection with the Seller or the Assets, whether or not disclosed on the Disclosure Schedule, including claims, without limitation, made by employees or former employees of Seller or Parent; (iv) any and all claims, including legal, administrative or creditor claims or actions, in connection with the Seller or the Assets or the transfer of Assets hereunder, if any fact material to any such claim or cause of action pleaded or stated there occurred prior to or on the Closing Date; and (v) costs and expenses (including reasonable attorneys' fees) incurred by Buyer in connection with any demand, action, suit, proceeding, demand, assessment or judgment incident to any of the foregoing (collectively, "Buyer's Damages").
Seller’s Indemnification Except as otherwise stated in this Agreement, after recording, the Buyer shall accept the Property AS IS, WHERE IS, with all defects, latent or otherwise. Neither Seller nor their licensed real estate agent(s) or any other agent(s) of the Seller, shall be bound to any representation or warranty of any kind relating in any way to the Property or its condition, quality or quantity, except as specifically set forth in this Agreement or any property disclosure, which contains representations of the Seller only, and which is based upon the best of the Seller’s personal knowledge.
Indemnification and Expenses (a) To the extent not previously paid pursuant to Section 4.12(e) of the Prior Agreement, the Company shall (and each of the Shareholders shall take all actions in its capacity as a shareholder necessary to) cause KMI to promptly pay or reimburse each Shareholder for any and all out-of-pocket fees and expenses (including the fees and expenses of legal counsel, accountants, financial advisors and other consultants or advisors) incurred by such Shareholder or its Affiliates (i) as of or prior to the date hereof in connection with the Agreement and Plan of Merger dated as of August 28, 2006 among KMI, Knight Acquisition Co. and the Company (the “Merger Agreement”) and the transactions contemplated thereby and (ii) as of, prior to or after the date hereof in connection with any shareholder litigation in connection with the Merger Agreement or the transactions contemplated thereby, including any amounts paid as damages or in settlement thereof. Any fees and expenses for which any Shareholder is entitled to payment or reimbursement pursuant to clause (ii) of the preceding sentence shall be paid or reimbursed promptly after such fees or expenses are incurred by such Shareholder and notice thereof is provided to the Company.
(b) From and after the date hereof, all reasonable fees and expenses of each Investor Shareholder (with respect to all periods prior to such Investor Shareholder ceasing to hold Class A Shares or Related Shares) and their counsel related to the administration of, and their rights and obligations under, the Charter, Bylaws and this Agreement shall be borne by the Company, provided, that such fees and expenses must be approved in advance by the Company (such approval not to be unreasonably withheld or delayed).
(c) All fees and expenses (including legal and other advisory fees and expenses) of the Investor Shareholders and their Affiliates incident to the IPO, including with respect to the evaluation, preparation, negotiation, structuring (tax, accounting, legal or otherwise), implementation and consummation thereof, and with respect to previously contemplated potential structures for an initial public offering of Knight Holdco LLC (or Subsidiaries or parent companies of Knight Holdco LLC) pursuant to the Prior Agreement, shall be borne by the Company, and shall be paid or reimbursed promptly after presentation of an invoice. For the avoidance of doubt, the Company shall not be responsible for any underwriting discounts or commissions or for fees and expenses of any Investor Shareholder or its Affiliates in their capacity as an underwriter of the IPO pursuant to this Section 7.12(c).
(d) With respect to any indemnification obligations of the Company pursuant to Section 5.8 and Section 7.12 of this Agreement, the Company hereby acknowledges and agrees (i) that it is the indemnitor of first resort with respect to all indemnification obligations of the Company pursuant to Section 5.8 and Section 7.12 of this Agreement (i.e., its obligations to an applicable indemnitee are primary and any obligation of the Investor Shareholders and their Affiliates (collectively, the “Fund Indemnitors”) to advance expenses or to provide indemnification and/or insurance for the same expenses or liabilities incurred by such indemnitee are secondary) and (ii) that it irrevocably waives, relinquishes and releases the Fund Indemnitors from any and all claims against the Fund Indemnitors for contribution, subrogation or any other recovery of any kind in respect thereof. For clarification, this Section 7.12(d) shall have no impact on the Selling Shareholders’ indemnification obligations under Section 5.8(b) of this Agreement or the parties’ respective contribution obligations as set forth under Section 5.8(f), and the Company is not waiving, relinquishing or releasing any claims against the Selling Shareholders that may arise under Section 5.8(b) or, with respect to the parties’ respective contribution obligations, Section 5.8(f).
(i) Each Person that is included within the definition of a particular Investor Shareholder acknowledges and agrees that it shall be jointly and severally liable for all obligations of any Class A Shareholder under Section 2.3(b) of this Agreement (arising in respect of such Investor Shareholder’s Class A Series) if such Class A Shareholder also is within the definition of such particular Investor Shareholder.
(ii) In the event that any Person (the “Applicable Seller”) included within the definition of a particular Investor Shareholder converts any Class A Shares in order to Transfer Class P Shares at a time when all other holders of Class A Shares of such Investor Shareholder’s Class A Series are not converting the same pro rata share of their Class A Shares in order to Transfer Class P Shares (such conversion and Transfer by the Applicable Seller, the “Applicable Transaction”), each Person that is included within the definition of such Investor Shareholder (the “Indemnifying Shareholders”) agrees to, jointly and severally, indemnify and hold harmless, to the fullest extent permitted by law, each of the Company, and its officers, directors, employees and agents, the holders of Class B Shares in such series and the holders of Class C Shares in such series from and against all Losses caused by, resulting from or relating to any lawsuit, claim, litigation or proceeding in which the indemnified party is included, brought by one or more investors or partners in any Person that is included within such definition of such particular Investor Shareholder, alleging a Loss based on the non-pro rata nature of the Applicable Transaction; provided, that this Section 7.12(e) shall be the sole and exclusive remedy of the indemnified parties with respect to any such Losses caused by, resulting from or relating to any such lawsuit, claim, litigation or proceeding.
Indemnification of Sellers Parent, LuxCo and BHN, jointly and severally hereby agree to indemnify and hold harmless Sellers, each of its Affiliates, and each of its members, managers, partners, directors, officers, employees, attorneys and agents and permitted assignees (the “Sellers Indemnitees”) against and in respect of any Losses incurred or sustained by any Sellers Indemnitee as a result of any breach, inaccuracy or nonfulfillment or the alleged breach, of any of the representations, warranties and covenants of LuxCo contained herein. The total payments made by Parent, LuxCo or BHN to Sellers Indemnitees with respect to Losses shall not exceed the Indemnifiable Loss Limit; provided, however, Sellers Indemnitees shall not be entitled to indemnification pursuant to this Section 10.2 unless and until the aggregate amount of Losses to Sellers Indemnitees equals at least the Basket, at which time, subject to the Indemnifiable Loss Limit, the Sellers Indemnitees shall be entitled to indemnification for the total amount of such Losses. Notwithstanding anything set forth in this Section 10.2, any Losses incurred by any Sellers Indemnitee arising out of the failure of Parent, LuxCo or BHN to perform any covenant or obligation to be performed by it at or after the Closing Date including payment of the Purchase Price, shall not be subject to or applied against the Indemnifiable Loss Limit or the Basket, respectively.
Indemnification by Buyers (a) Subject to this Article 11, Buyers, from and after Closing, shall indemnify and hold harmless Sellers, their Affiliates, and their respective officers, directors, equity holders, managers, members, principals, attorneys, agents, employees or other representatives (collectively, “Sellers Indemnified Parties”) from and against any and all Indemnifiable Losses that such Sellers Indemnified Party incurs as a result of, or with respect to (i) the breach of any of the representations or warranties made by Buyers in this Agreement, (ii) any breach or non-fulfillment of any of the covenants or other agreements made by Buyers in this Agreement, (iii) any of the Assumed Liabilities, and (iv) any fraud, willful misconduct or criminal acts of Buyers or their officers, directors, members, shareholders, employees, agents and independent contractors;
(b) Buyers will have no obligation to indemnify Sellers Indemnified Parties pursuant to Section 11.2(a)(i) in respect of Indemnifiable Losses arising from the breach of, or inaccuracy in, any representation or warranty described therein unless the aggregate amount of all such Indemnifiable Losses incurred or suffered by Sellers Indemnified Parties exceeds $700,000, in which event the Sellers Indemnified Parties shall be entitled to seek indemnification under Sections 11.2(a)(i) for all claims over $350,000; provided, however, that the foregoing limitation will not apply to claims for indemnification pursuant to Section 11.2(a)(i) in respect of breaches of, or inaccuracies in, representations and warranties set forth in Section 5.1 (Organization; Capacity) or Section 5.2 (Authority; Noncontravention) (collectively, “Buyers Fundamental Representations”). For avoidance of doubt, claims for indemnification pursuant to Sections 11.2(a)(ii), (iii) and (iv) are not subject to the monetary limitation set forth in this Section 11.2(b); and
(c) Buyers’ aggregate liability in respect of claims for indemnification pursuant to Section 11.2(a)(i) and (ii) will not exceed an amount equal to the 20% Cap for its breach of representations, warranties and covenants other than the Buyers Fundamental Representations. Buyer’s aggregate liability in respect of claims for indemnification under this Agreement will not exceed the Purchase Price Cap, except that Buyers’ aggregate liability in respect of claims pursuant to Section 11.2(a)(iii) shall not be subject to the 20% Cap or the Purchase Price Cap.
(d) Anything herein to the contrary notwithstanding, obligations of Buyer under Section 10.1, 10.2 and Section 10.13 shall not be subject to the monetary limitation set forth in Section 11.2(b) or the 20% Cap or the Purchase Price Cap in Section 11.2(c).
Exculpation and Indemnification of Escrow Agent 9.1. The Escrow Agent shall have no duties or responsibilities other than those expressly set forth herein. The Escrow Agent shall have no duty to enforce any obligation of any person to make any payment or delivery, or to direct or cause any payment or delivery to be made, or to enforce any obligation of any person to perform any other act. The Escrow Agent shall be under no liability to the other parties hereto or to anyone else by reason of any failure on the part of any party hereto or any maker, guarantor, endorser or other signatory of any document or any other person to perform such person's obligations under such document. Except for amendments to this Agreement referred to below, and except for instructions given to the Escrow Agent by the Company and the subscribers relating to the Escrow Account, the Escrow Agent, as applicable, shall not be obligated to recognize any agreement between any and all of the persons referred to herein, notwithstanding that references thereto may be made herein and whether or not it has knowledge thereof.
9.2. The Escrow Agent shall not be liable to the Company or to anyone else for any action taken or omitted by it, or any action suffered by it to be taken or omitted, in good faith and in the exercise of its own best judgment. The Escrow Agent may rely conclusively and shall be protected in acting upon any order, notice, demand, certificate, opinion or advice of counsel (including counsel chosen by the Escrow Agent), statement, instrument, report or other paper or document (not only as to its due execution and the validity and effectiveness of its provisions, but also as to the truth and acceptability of any information therein contained), which is believed by the Escrow Agent, as applicable, to be genuine and to be signed or presented by the proper person or persons. The Escrow Agent shall not be bound by any notice or demand, or any waiver, modification, termination or rescission of this Escrow Agreement or any of the terms thereof, unless evidenced by a writing delivered to the Escrow Agent, as applicable, signed by the proper party or parties and, if the duties or rights of the Escrow Agent, as applicable, are affected, unless it shall give its prior written consent thereto.
9.3. The Escrow Agent shall not be responsible for the sufficiency or accuracy of the form of, or the execution, validity, value or genuineness of, any document or property received, held or delivered by it hereunder, or of any signature or endorsement thereon, or for any lack of endorsement thereon, or for any description therein, nor shall the Escrow Agent be responsible or liable to the other parties hereto or to anyone else in any respect on account of the identity, authority or rights of the persons executing or delivering or purporting to execute or deliver any document or property pursuant to the provisions of this Agreement. Except as specifically provided for herein, the Escrow Agent shall have no responsibility with respect to the use or application of any funds or other property paid or delivered by the Escrow Agent pursuant to the provisions hereof. The Escrow Agent shall not be liable to the Company or to anyone else for any loss which may be incurred by reason of any investment of any monies which it holds hereunder provided the Escrow Agent, as applicable, has complied with the provisions of Section 2 hereunder.
9.4. The Escrow Agent shall have the right to assume in the absence of written notice to the contrary from the proper person or persons that a fact or an event by reason of which an action would or might be taken by the Escrow Agent, as applicable, does not exist or has not occurred, without incurring liability to the other parties hereto or to anyone else for any action taken or omitted, or any action suffered by it to be taken or omitted, in good faith and in the exercise of its own best judgment, in reliance upon such assumption.
9.5. To the extent that the Escrow Agent becomes liable for the payment of taxes, including withholding taxes, in respect of income derived from the investment of funds held hereunder or any payment made hereunder, the Escrow Agent, as applicable, may pay such taxes. The Escrow Agent, as applicable, may withhold from any payment of monies held by it hereunder such amount as the Escrow Agent, as applicable, estimates to be sufficient to provide for the payment of such taxes not yet paid, and may use the sum withheld for that purpose. The Escrow Agent shall be indemnified and held harmless against any liability for taxes and for any penalties or interest in respect of taxes, on such investment income or payments in the manner provided in Section 9.6.
9.6. The Escrow Agent will be indemnified and held harmless by the Company from and against any and all expenses, including reasonable counsel fees and disbursements, or loss suffered by the Escrow Agent, as applicable, in connection with any action, suit or other proceeding involving any claim, or in connection with any claim or demand, which in any way, directly or indirectly, arises out of or relates to this Escrow Agreement, the services of the Escrow Agent, as applicable, hereunder, the monies or other property held by it hereunder or any income earned from investment of such monies; provided, that such expenses or loss are not as a result of the Escrow Agent, as applicable, acting, or omitting to take action, in bad faith or with willful misconduct or gross negligence promptly after the receipt by the Escrow Agent, as applicable, of notice of any demand or claim or the commencement of any action, suit or proceeding, the Escrow Agent, as applicable, shall, if a claim in respect thereof is to be made against the Company, notify the Company thereof in writing, but the failure by the Escrow Agent, as applicable, to give such notice shall not relieve the Company from any liability which the Company may have to the Escrow Agent hereunder. For the purposes hereof, the term "expense or loss" shall include all amounts paid or payable to satisfy any claim, demand or liability, or in settlement of any claim, demand, action, suit or proceeding settled with the express written consent of the Escrow Agent, and all costs and expenses, including, but not limited to, reasonable counsel fees and disbursements, paid or incurred in investigating or defending against any such claims, demand, action, suit or proceeding.
INDEMNIFICATION AND RECOVERY H-GAC’s liability under this Agreement, whether for breach of contract, warranty, negligence, strict liability, in tort or otherwise, is limited to its order processing charge. In no event will H-GAC be liable for any loss of use, loss of time, inconvenience, commercial loss, lost profits or savings or other incidental, special or consequential damages to the full extent such use may be disclaimed by law. Contractor agrees, to the extent permitted by law, to defend and hold harmless H-GAC, its board members, officers, agents, officials, employees and indemnities from any and all claims, costs, expenses (including reasonable attorney fees), actions, causes of action, judgements, and liens arising as a result of Contractor’s negligent act or omission under this Agreement. Contractor shall notifiy H-GAC of the threat of lawsuit or of any actual suit filed against Contractor relating to this Agreement.
