INDEMNIFICATION BY THE PRINCIPAL STOCKHOLDERS. Subject to the other provisions of this Article IX, the Principal Stockholders, jointly and severally, hereby agree to defend, indemnify and hold the Buyer harmless from and against, and to reimburse the Buyer with respect to, any and all losses, damages, liabilities, claims, judgments, settlements, fines, costs and expenses (including reasonable attorneys’ fees and reasonable expenses of investigation) (“Indemnifiable Losses”), of every nature whatsoever incurred by the Buyer (which will be deemed to include, but without any duplicative indemnity, any of the foregoing incurred by Stealth) caused by or arising out of or in connection with (i) the breach by any of the Sellers of any representation or warranty of the Sellers contained in this Agreement or in any agreement, certificate or other document delivered to the Buyer pursuant to this Agreement other than under Article III hereof (it being understood that the remedy for breach of any representation or warranty under Section 2.8 hereof shall apply to Indemnifiable Losses only with respect to any federal or state Tax liability of Stealth attributable to periods (or any portion thereof) ending on or prior to the Closing and only to the extent such liabilities were not accrued and reserved for on the Closing Balance Sheet and taken into account in determining the Closing Net Worth); (ii) the breach by any of the Sellers of any agreement or covenant required by this Agreement or any other agreement executed in connection herewith to be performed by them other than the breach by any of the Sellers to perform any agreement or covenant under Article I hereof; (iii) any federal or state Tax liability of Stealth attributable to periods (or any portion thereof) ending on or prior to the Closing but only to the extent such liabilities were not accrued and reserved for on the Closing Balance Sheet and taken into account in determining the Closing Net Worth; (iv) any products liability claims with respect to any product or component thereof manufactured by or shipped by Stealth, in whole or in part, prior to the Closing Date relating to actual injury, death or physical damage to any person or property; and (v) any returns of defective products or components under warranty manufactured by or shipped by Stealth in excess of seven percent (7%) of total product sales in any one year period prior to the Closing Date. The foregoing obligations to indemnify the Buyer will be determined without regard to any right to indemnification to which any Person may have in his or her capacity as an officer, director, employee, agent or any other capacity of Stealth, provided no Seller will be entitled to any indemnification from the Buyer or Stealth for amounts paid hereunder. There will be no right of contribution or subrogation from the Buyer or Stealth for indemnification payments made by or for the account of the Sellers.
Appears in 1 contract
INDEMNIFICATION BY THE PRINCIPAL STOCKHOLDERS. Subject The Principal Stockholders agree to the other provisions of this Article IXand shall jointly and severally indemnify Buyer and its Affiliates, stockholders, officers, directors, employees, agents, partners, representatives, successors and assigns (collectively, the Principal Stockholders, jointly "BUYER PARTIES") and severally, hereby agree to defend, indemnify save and hold the each of them harmless against and pay on behalf of or reimburse such Buyer harmless from Parties as and againstwhen incurred for any loss, liability, demand, claim, action, cause of action, cost, damage, deficiency, Tax, penalty, fine or expense, whether or not arising out of third-party claims (including interest, penalties, reasonable attorneys' fees and to reimburse the Buyer with respect to, any expenses and all lossesamounts paid in investigation, damages, liabilities, claims, judgments, settlements, fines, costs and expenses (including reasonable attorneys’ fees and reasonable expenses defense or settlement of investigation) (“Indemnifiable Losses”), of every nature whatsoever incurred by the Buyer (which will be deemed to include, but without any duplicative indemnity, any of the foregoing incurred by Stealthforegoing) caused by (collectively, "LOSSES"), which any such Buyer Party may suffer, sustain or arising out of or become subject to, as a result of, in connection with with, relating or incidental to or by virtue of: (i) the any breach by the Company or any of the Sellers Seller of any representation or warranty of made by the Sellers contained Company or any Seller in this Agreement or any of the Schedules or Exhibits attached hereto, or in any agreement, certificate of the certificates or other document delivered to instruments or documents furnished by the Buyer Company pursuant to this Agreement other than under Article III hereof (it being understood that the remedy for breach of any representation or warranty under Section 2.8 hereof shall apply to Indemnifiable Losses only with respect to any federal or state Tax liability of Stealth attributable to periods (or any portion thereof) ending on or prior to the Closing and only to the extent such liabilities were not accrued and reserved for on the Closing Balance Sheet and taken into account in determining the Closing Net Worth)Agreement; (ii) the any nonfulfillment or breach by any of the Sellers of any covenant, agreement or covenant required other provision by the Company or any Seller under this Agreement or any other agreement executed in connection herewith to be performed by them other than the breach by any of the Sellers to perform any agreement or covenant under Article I hereofSchedules and Exhibits attached hereto; (iii) any federal action, demand, proceeding, investigation or state Tax liability of Stealth attributable to periods (claim by any Person against or affecting the Company or any portion thereof) ending on Buyer Party which, if successful, would give rise to or prior evidence the existence of or relate to a breach of any of the Closing but only to representations, warranties, covenants or agreements of the extent such liabilities were not accrued and reserved for on the Closing Balance Sheet and taken into account in determining the Closing Net WorthCompany or any Seller under this Agreement; (iv) any products liability claims Taxes of the Company or any of its Subsidiaries with respect to any product Tax year or component portion thereof manufactured by ending on or shipped by Stealth, in whole or in part, prior to before the Initial Closing Date relating to actual injury, death as determined in accordance with Section 8.11 hereof; or physical damage to any person or property; and (v) any returns of defective products or components the matters set forth on the INDEMNIFICATION SCHEDULE attached hereto; PROVIDED THAT the Principal Stockholders shall not have any liability under warranty manufactured by or shipped by Stealth clause (i) above (other than with respect to the representations and warranties contained in Section 5.2 (Capital Stock and Related Matters; Title to Shares), Section 5.3 (Authorization/ Noncontravention), Section 5.20 (Tax Matters), Section 5.21(Brokerage and Transaction Bonuses) and the last sentence of Section 5.24 (Affiliated Transactions)) unless the aggregate of all Losses relating thereto for which the Principal Stockholders would, but for this proviso, be liable exceeds on a cumulative basis an amount equal to $100,000 (and then the Principal Stockholders shall be liable for all such Losses in excess of seven percent the $100,000 deductible amount); and PROVIDED FURTHER that the Principal Stockholders' aggregate liability under clause (7%i) of total product sales in any one year period prior above (other than with respect to the Closing Daterepresentations and warranties contained in Section 5.2 (Capital Stock and Related Matters; Title to Shares), Section 5.3 (Authorization/Noncontravention), Section 5.20 (Tax Matters), Section 5.21 (Brokerage and Transaction Bonuses) and the last sentence of Section 5.24 (Affiliated Transactions)), shall in no event exceed the amount of the Purchase Price received by the Principal Stockholders and each Principal Stockholder's aggregate liability shall in no event exceed the amount of the Purchase Price received by such Principal Stockholder. The foregoing obligations to indemnify Notwithstanding the foregoing, nothing in this Agreement (including this Section 8.2(a)) shall limit or restrict any of the Buyer will be determined without regard to any Parties' right to indemnification to which maintain or recover any Person may have amounts in his connection with any action or her capacity as an officer, director, employee, agent claim based upon fraudulent misrepresentation or any other capacity of Stealth, provided no Seller will be entitled to any indemnification from the Buyer or Stealth for amounts paid hereunder. There will be no right of contribution or subrogation from the Buyer or Stealth for indemnification payments made by or for the account of the Sellersdeceit.
Appears in 1 contract
Samples: Stock Purchase and Recapitalization Agreement (Linc Net Inc)
INDEMNIFICATION BY THE PRINCIPAL STOCKHOLDERS. Subject The Principal Stockholders, severally and not jointly with each other Principal Stockholder, on behalf of themselves and their respective successors, executors, administrators, estates, heirs and permitted assigns as contemplated by Section 10.04, agree subsequent to the Closing Date to indemnify and hold harmless AMRI, its subsidiaries and their respective stockholders, officers, directors, employees and agents (other provisions of this Article IX, than the Principal Stockholders) (individually, jointly a "Buyer Indemnified Party" and severallycollectively, hereby agree to defend, indemnify and hold the "Buyer harmless Indemnified Parties") from and against, against and to reimburse the Buyer with in respect to, any and of all losses, liabilities, obligations, damages, liabilitiesdeficiencies, claimsactions, suits, proceedings, demands, assessments, orders, judgments, settlementsfines, finespenalties, costs and expenses (including the reasonable attorneys’ fees fees, disbursements and reasonable expenses of investigationattorneys, accountants and consultants) (“Indemnifiable Losses”), of every any kind or nature whatsoever incurred by the Buyer (which will be deemed to include, but without any duplicative indemnity, any of the foregoing incurred by Stealth) caused by whether or not arising out of third-party claims and including all amounts paid in investigation, defense or settlement of the foregoing) (a "Loss" or "Losses") sustained, suffered or incurred by or made against any Buyer Indemnified Party, as such Losses are incurred, arising out of, based upon or in connection with with:
(ia) the any breach by any of the Sellers of any representation or warranty made by NCE and the Principal Stockholders pursuant to Article III of this Agreement or in any certificate delivered pursuant to Section 7.01(a) in connection with the Sellers contained Closing;
(b) any breach of any covenant or agreement made by NCE in this Agreement or in any agreement, certificate or other document delivered to the Buyer pursuant to this Agreement other than under Article III hereof Schedule hereto;
(it being understood that the remedy for c) any breach of any representation and warranty made by any Principal Stockholder in Article II of this Agreement;
(d) any breach of any covenant or warranty under Section 2.8 hereof shall apply agreement made by any Principal Stockholder of this Agreement or in any Schedule hereto;
(e) liabilities relating to Indemnifiable Losses only with respect to any federal federal, state, local or state Tax liability of Stealth attributable to foreign Taxes payable by NCE (including its predecessors) for periods (or any portion thereof) ending on or prior to the date of the Closing and only to the extent such liabilities were periods including but not accrued and reserved for ending on the Closing Balance Sheet and taken into account in determining the Closing Net Worth); (ii) the breach by any date of the Sellers of any agreement or covenant required by this Agreement or any other agreement executed in connection herewith to be performed by them other than the breach by any of the Sellers to perform any agreement or covenant under Article I hereof; (iii) any federal or state Tax liability of Stealth attributable to periods (or any portion thereof) ending on or prior to the Closing but only with respect to the extent such portion of the period ending on the date of the Closing;
(f) liabilities were not accrued and reserved for relating to Losses with respect to the matters set forth on SCHEDULE 9.02(F) attached hereto;
(g) liabilities relating to Losses resulting from any inaccuracy on the Closing Balance Sheet and taken into account in determining the Closing Net WorthAdjustment Certificate; or
(ivh) any products liability claims with respect to any product or component thereof manufactured by or shipped by Stealthfees and expenses of the Principal Stockholders and NCE (including without limitation legal fees, in whole or in part, prior to the Closing Date relating to actual injury, death or physical damage to any person or property; consulting fees and (vaccounting fees) any returns of defective products or components under warranty manufactured by or shipped by Stealth in excess of seven percent $200,000 relating to the execution, delivery and performance of this Agreement paid, assumed or otherwise borne by AMRI or NCE. Claims under clauses (7%a) through (g) of total product sales in any one year period prior this Section 9.02 hereinafter collectively referred to the Closing Date. The foregoing obligations to indemnify the as "Buyer will be determined without regard to any right to indemnification to which any Person may have in his or her capacity as an officer, director, employee, agent or any other capacity of Stealth, provided no Seller will be entitled to any indemnification from the Buyer or Stealth for amounts paid hereunder. There will be no right of contribution or subrogation from the Buyer or Stealth for indemnification payments made by or for the account of the SellersIndemnifiable Losses."
Appears in 1 contract
INDEMNIFICATION BY THE PRINCIPAL STOCKHOLDERS. Subject to the other provisions of this Article IX, the The Principal StockholdersStockholders shall, jointly and severally, hereby agree to defendindemnify the Buyer and the Company in respect of, indemnify and hold the Buyer and the Company harmless from and against, and to reimburse the Buyer with respect to, any and all lossesdebts, obligations and other liabilities (whether absolute, accrued, contingent, fixed or otherwise, or whether known or unknown, due or to become due or otherwise), monetary damages, liabilitiesfines, claimsfees, judgmentspenalties, settlementsinterest obligations, finesdeficiencies, losses, costs and expenses (including reasonable attorneys’ without limitation amounts paid in settlement, interest, court costs, costs of investigators, fees and reasonable expenses of investigationattorneys, accountants, financial advisors and other experts, and other expenses of litigation) (“Indemnifiable Losses”)collectively, of every nature whatsoever "DAMAGES") incurred or suffered by the Buyer (which will be deemed or the Company resulting from, relating to include, but without any duplicative indemnity, any of the foregoing incurred by Stealth) caused by or arising out of or in connection with constituting:
(i) the any (a) misrepresentation or breach by any of the Sellers of any representation or warranty of the Sellers Company or any Stockholder contained in this Agreement Agreement, the Minority Stockholder Agreements or in any agreementCompany Certificate or (b) any failure to perform any covenant or agreement of the Company or any Stockholder contained in this Agreement, certificate the Minority Stockholder Agreements or other document delivered in any Company Certificate;
(ii) the termination prior to the Buyer pursuant to this Agreement other than Closing of employment of employees of the Company that arose under Article III hereof (it being understood that the remedy for breach of any representation or warranty under Section 2.8 hereof shall apply to Indemnifiable Losses only with respect to any federal or state Tax liability of Stealth attributable to periods (law or under any employee benefit plan established or maintained by the Company, or any portion thereofworkplace conditions of the Company existing prior to the Closing;
(iii) ending on any claim by an employee or former employee of the Company either (a) for any payments under any profit sharing program existing prior to the Closing and only or (b) relating to the extent such liabilities were not accrued and reserved for on the Closing Balance Sheet and taken into account in determining the Closing Net Worth); (ii) the breach by any of the Sellers of any agreement alleged or covenant required by this Agreement or any other agreement executed in connection herewith to be performed by them other than the breach by any of the Sellers to perform any agreement or covenant under Article I hereof; (iii) any federal or state Tax liability of Stealth attributable to periods (or any portion thereof) ending on or actual employment practices prior to the Closing but only to the extent such liabilities were not accrued and reserved for on the Closing Balance Sheet and taken into account in determining the Closing Net Worth; Closing, including discrimination;
(iv) any products liability claims with respect to claim by a stockholder or former stockholder of the Company, or any product or component thereof manufactured by or shipped by Stealth, in whole or in part, prior to the Closing Date relating to actual injury, death or physical damage to any other person or propertyentity, seeking to assert, or based upon: (a) ownership or rights to ownership of any shares of stock of the Company or options therefor; and (b) any rights of a stockholder (other than the right to receive the consideration set forth in Section 1.2 of this Agreement or Section 1.2 of the Minority Stockholder Agreements), including any option or preemptive rights or rights to notice or to vote; (c) any rights under the Articles of Incorporation, By-laws or other organizational document of the Company; or (d) any claim that his, her or its shares were wrongfully repurchased by the Company; and
(v) any returns of defective products claim by any financial advisor, broker, agent, finder, attorney, accountant or components under warranty manufactured other professional utilized or engaged by or shipped by Stealth in excess of seven percent (7%) of total product sales in any one year period prior to the Closing Date. The foregoing obligations to indemnify the Buyer will be determined without regard to any right to indemnification to which any Person may have in his or her capacity as an officer, director, employee, agent Company or any Stockholder in connection with the transactions contemplated hereby, other capacity of Stealth, provided no Seller will be entitled to than any indemnification from the Buyer or Stealth such claim which is for amounts paid hereunder. There will be no right of contribution or subrogation from the Buyer or Stealth for indemnification payments made by or for the account of the SellersCovered Expenses (as defined in Section 7.13).
Appears in 1 contract
INDEMNIFICATION BY THE PRINCIPAL STOCKHOLDERS. (a) Subject to the other provisions of limitations set forth in this Article IXXI, from and after the Closing, each Principal Stockholder (together, the “Company Indemnifying Parties”) shall, severally but not jointly, based on each such Principal Shareholders’ pro rata ownership of the Company assuming for such purposes that all equity interests of the Company are owned by the Principal Stockholders, jointly and severally, hereby agree to defend, indemnify and hold defend Buyer, the Merger Subs and the Surviving Corporation, and each of their respective Affiliates, stockholders, members, managers, officers, directors employees, consultants, advisors, agents and representatives (collectively, the “Buyer harmless from and Indemnitees”) against, and shall hold such Buyer Indemnitees harmless from, any loss, liability, claim, demand, settlement, judgment, award, fine, charge, cost, action, suit, proceeding, assessed interest, penalty, damage, Tax or expense of any nature including reasonable outside legal and accounting and outside professional services expenses and costs, and amounts paid in investigation, defense or settlement of the foregoing (collectively, “Losses”) directly or indirectly resulting from, based upon, arising out of, attributable to, relating to reimburse the or incurred by such Buyer Indemnitees in connection with, or otherwise with respect to, any and all losses, damages, liabilities, claims, judgments, settlements, fines, costs and expenses (including reasonable attorneys’ fees and reasonable expenses of investigation) (“Indemnifiable Losses”), of every nature whatsoever incurred by the Buyer (which will be deemed to include, but without any duplicative indemnity, any of the foregoing incurred by Stealth) caused by or arising out of or in connection with :
(i) the any breach by or alleged breach of, or any of the Sellers of inaccuracy contained in, any representation or and warranty of the Sellers Company contained in this Agreement Agreement, in the Company Compliance Certificate or in any agreementother document, certificate certificate, schedule or other document instrument delivered or executed in connection herewith;
(ii) any failure of the Company to perform any covenant or agreement of the Company contained in this Agreement;
(iii) any matter set forth on Schedule 11.2(a)(iii);
(iv) the amount of any Transaction Costs outstanding at the Closing and not set forth on the Transaction Costs Certificate or that are not paid from the Adjustment Escrow Fund;
(v) the amount of any Closing Indebtedness of the Group Companies outstanding at Closing and not set forth on the Indebtedness Certificate or that are not paid from the Adjustment Escrow Fund;
(vi) any inaccuracy contained in the Allocation Schedule or the Allocation Certificate or the Working Capital Certificate to the Buyer pursuant extent that it results in a Loss;
(vii) (A) any Taxes of each Group Company with respect to this Agreement other than under Article III hereof any Pre-Closing Tax Period, (it being understood that the remedy for B) any Taxes arising with respect to a breach of any representation or warranty set forth in Section 4.9 (Taxes) but for this purpose determined without regard to the Company Disclosure Schedule, (C) any Taxes of any Person (other than the Group Companies) for which any Group Company is held liable (1) under Treasury Regulations Section 2.8 hereof shall apply to Indemnifiable Losses only with respect to any federal or state Tax liability of Stealth attributable to periods 1.1502-6 (or any portion thereofsimilar provision of applicable Law) ending by reason of such entity being included in any consolidated, affiliated, combined or unitary group at any time on or before the Closing Date, or (2) as a transferee or successor, by Contract or otherwise as a result of a transaction consummated, or relationship existing, on or prior to the Closing, (D) any unpaid payroll or other similar Taxes to the extent such Taxes have not been reflected in the calculation of Transaction Costs and have not reduced the Merger Consideration pursuant to Section 2.4 or have not been the subject of Tax withholdings made on behalf of a payee pursuant to this Agreement;
(viii) any Dissenting Shares Payments;
(ix) a stockholder or former stockholder of the Company, or any other Person seeking to assert: (i) ownership rights of any Company’s Capital Stock; (ii) any rights of an Equity Holder (other than the right to receive the consideration described in Article II in accordance with the terms of this Agreement), including any option, preemptive right or rights to notice or vote; (iii) any rights under the Company’s Organizational Documents; (iv) any claim that he, she or its shares were wrongfully repurchased by the Company; (v) any claim that he, she or it is entitled to receive any consideration in exchange for any securities of the Company other than as expressly set forth in the Allocation Schedule; or (vi) any claim that any shares of the Company’s Capital Stock were not properly issued or authorized;
(x) the Information Statement;
(xi) the Spin-Out Transaction;
(xii) the HSL Loan Agreement;
(xiii) the issuance, on or prior to the Closing Date, of any stock option award under a Company Stock Plan or Company Benefit Plan and only the administration of the Company Stock Plan;
(xiv) any failure to properly include in the extent such liabilities were not accrued gross income of any employee or other individual the amount of any premiums or contributions made to or for any “qualified benefits” as defined in Section 125(f) of the Code; or
(xv) and reserved for on the Closing Balance Sheet and taken into account in determining the Closing Net Worth); (ii) the breach by any Actions, demands or assessments incidental to any of the Sellers matters set forth in clauses (i) through (xiv) above (including any proceeding commenced by a Buyer Indemnitee for the purpose of enforcing its rights under this Article XI), and any Actions, demands or assessments brought by a third party against any Equity Holder of the Company or any former Affiliate of the Company.
(b) For purposes of this Article XI, any inaccuracy in or breach of any agreement representation or covenant required by this Agreement or any other agreement executed in connection herewith to be performed by them other than warranty and the breach by any determination of the Sellers to perform amount of any agreement or covenant under Article I hereof; (iii) any federal or state Tax liability of Stealth attributable to periods (or any portion thereof) ending on or prior to the Closing but only to the extent such liabilities were not accrued and reserved for on the Closing Balance Sheet and taken into account in determining the Closing Net Worth; (iv) any products liability claims with respect to any product or component thereof manufactured by or shipped by Stealth, in whole or in part, prior to the Closing Date relating to actual injury, death or physical damage to any person or property; and (v) any returns of defective products or components under warranty manufactured by or shipped by Stealth in excess of seven percent (7%) of total product sales in any one year period prior to the Closing Date. The foregoing obligations to indemnify the Buyer will Losses resulting therefrom shall be determined without regard to any right to indemnification to which any Person may have in his or her capacity as an officerKnowledge, directormateriality, employee, agent Company Material Adverse Effect or any other capacity similar qualification contained in or otherwise applicable to such representation or warranty.
(c) No Buyer Indemnitee may make a claim for indemnification pursuant to Section 11.2(a)(i) (other than with respect to a breach of Stealtha Fundamental Representation or with respect to fraud, provided intentional misrepresentation or willful misconduct), unless and until indemnifiable Losses exceed $337,500 (the “Deductible”), in which case the Buyer Indemnitee may recover all indemnifiable Losses in excess of the Deductible or available insurance coverage. Buyer shall use commercially reasonable efforts to collect any Loss covered by the R&W Insurance Policy.
(d) Subject to the last sentence of this Section 11.2(d), in no Seller will event shall the Company Indemnifying Parties be entitled obligated to indemnify the Buyer Indemnitees (i) under Section 11.2(a)(i), other than with respect to a breach of a Fundamental Representation, from any source other than the Indemnification Escrow Fund and (ii) under Section 11.2(a)(i), with respect to a breach of any Fundamental Representations, and under Sections 11.2(a)(ii)-(xv), in any amount in excess of the aggregate Merger Consideration, as may be adjusted for any Contingent Payment. Notwithstanding any provision of this Agreement, nothing in this Agreement shall limit the liability of the Company Indemnifying Parties may have for fraud or intentional misrepresentation or willful misconduct.
(e) The Parties acknowledge and agree that, except in the case of fraud, intentional misrepresentation or willful misconduct, from and after the Closing, their sole and exclusive remedy with respect to any and all matters arising out of, relating to or connected with this Agreement, the Group Companies and their respective assets and liabilities and the Merger shall be pursuant to the indemnification set forth in Article XI.
(f) If, and to the extent that, a Company Indemnifying Party has made an out of pocket payment to a Buyer Indemnitee in respect of a Loss (each a “Loss Payment”), and thereafter funds are to be released from the Buyer Indemnification Escrow Fund or Stealth for paid from the R&W Insurance Policy, then, notwithstanding anything in this Agreement to the contrary, (i) with respect amounts paid hereunder. There will be no right of contribution or subrogation from the Indemnification Fund for which a Buyer or Stealth Indemnitee has received a Loss Payment, the Stockholders’ Representative shall cause such Company Indemnifying Parties to be reimbursed, pro-rata, from the funds released from the Indemnification Escrow Fund in an amount up to the aggregate amount of all Loss Payments prior to the Stockholders’ Representative causing any such amounts released from the Indemnification Escrow Fund being distributed to any Equity Holder and (ii) with respect to amounts recovered under the R&W Insurance Policy for indemnification payments made by or which a Buyer Indemnitee has received a Loss Payment, Buyer shall pay to the Stockholders’ Representative (for the account benefit of the SellersCompany Indemnifying Parties) the amount recovered under the R&W Insurance Policy by Buyer up to the amount of the Loss Payment.
Appears in 1 contract
Samples: Agreement and Plan of Merger (Tabula Rasa HealthCare, Inc.)
INDEMNIFICATION BY THE PRINCIPAL STOCKHOLDERS. Subject to the other provisions of this Article IXSection 11.3 hereof, the Principal Stockholders, Stockholders jointly and severally, hereby severally agree to defendindemnify Symposium, indemnify Symposium Sub and their respective, officers, directors, stockholders, employees, affiliates, attorneys, accountants and agents (the "Symposium Parties"), and hold the Buyer them harmless from and against, and to reimburse the Buyer with respect tofrom, any and all damages, losses, damages, liabilities, claims, judgments, settlements, fines, costs liabilities and expenses (including reasonable attorneys’ fees and including, without limitation, reasonable expenses of investigationinvestigation and reasonable attorneys' fees and expenses in connection with any action, suit or proceeding brought against the Symposium Parties (collectively the "Damages") (“Indemnifiable Losses”), of every nature whatsoever incurred or suffered by the Buyer Symposium Parties after the Closing arising out of (which will be deemed to includei) any breach of any representation, but without any duplicative indemnitywarranty, covenant or agreement of WeFusion or any of the foregoing incurred by Stealth) caused by or arising out of or in connection with (i) the breach by any of the Sellers of any representation or warranty of the Sellers contained Principal Stockholders set forth in this Agreement or in any agreementthe Stockholder's Questionnaire, certificate or other document delivered to as the Buyer pursuant to this Agreement other than under Article III hereof (it being understood that the remedy for breach of any representation or warranty under Section 2.8 hereof shall apply to Indemnifiable Losses only with respect to any federal or state Tax liability of Stealth attributable to periods (or any portion thereof) ending on or prior to the Closing and only to the extent such liabilities were not accrued and reserved for on the Closing Balance Sheet and taken into account in determining the Closing Net Worth)case may be; (ii) any liabilities of WeFusion not reflected on the breach by any of the Sellers of any agreement or covenant required by this Agreement or any other agreement executed in connection herewith to be performed by them other than the breach by any of the Sellers to perform any agreement or covenant under Article I hereof; WeFusion Interim Balance Sheet, (iii) any federal or state Tax liability of Stealth attributable to periods (or any portion thereof) ending on or prior to the Closing but only to the extent such liabilities were not accrued and reserved for on the Closing Balance Sheet and taken into account in determining the Closing Net Worth; Pre-September Trade Liabilities, (iv) any products liability claims with respect liabilities or obligations to any product Releasor, notwithstanding the disclosure, if any, of such liability or component thereof manufactured by potential liability on the WeFusion Disclosure Schedule; or shipped by Stealth, in whole or in part, prior to the Closing Date relating to actual injury, death or physical damage to any person or property; and (v) any returns Taxes payable by WeFusion with respect to the Pre-Closing Period (including any Taxes payable by WeFusion with respect to the transactions contemplated hereby and by the other Transaction Documents and including any Taxes listed on the WeFusion Disclosure Schedule). Notwithstanding the foregoing, the Principal Stockholders shall have no liability under this Section 11.2 in respect of: (A) breaches of defective products representations and warranties by WeFusion or components under warranty manufactured the Principal Stockholder; (B) liabilities other than Pre-September Trade Liabilities; or (C) the FICA and other similar Taxes listed on Section 3.16(c) of the WeFusion Disclosure Schedule unless and until the aggregate amount of all claims by the Symposium Parties arising out of one or shipped by Stealth more such breaches exceeds $35,000 in the aggregate, in which case the Stockholders shall be liable for all amounts in excess of seven percent (7%) of total product sales in any one year period prior to the Closing Date. The foregoing obligations to indemnify the Buyer will be determined without regard to any right to indemnification to which any Person may have in his or her capacity as an officer, director, employee, agent or any other capacity of Stealth, provided no Seller will be entitled to any indemnification from the Buyer or Stealth for amounts paid hereunder. There will be no right of contribution or subrogation from the Buyer or Stealth for indemnification payments made by or for the account of the Sellers$35,000.
Appears in 1 contract
INDEMNIFICATION BY THE PRINCIPAL STOCKHOLDERS. Subject (a) The Principal Stockholders jointly and severally agree subsequent to the other provisions of this Article IX, the Principal Stockholders, jointly and severally, hereby agree Closing to defend, indemnify and hold the Buyer Company, Parent and their respective subsidiaries and affiliates and persons serving as officers, directors, partners or employees thereof (individually a "PURCHASER INDEMNIFIED PARTY" and collectively the "PURCHASER INDEMNIFIED PARTIES") harmless from and against, and to reimburse the Buyer with respect to, against any and all losses, damages, liabilities, claimslosses, judgments, settlementstaxes, fines, costs penalties, costs, and expenses (including including, without limitation, reasonable attorneys’ fees and reasonable expenses of investigationcounsel) (“Indemnifiable Losses”), of every any kind or nature whatsoever incurred (whether or not arising out of third-party claims and including all amounts paid in investigation, defense or settlement of the foregoing) which may be sustained or suffered by the Buyer (which will be deemed to include, but without any duplicative indemnity, any of the foregoing incurred by Stealth) caused by or them arising out of or in connection with based upon any of the following matters:
(i) the fraud, intentional misrepresentation or a deliberate or willful breach by the Company or any Principal Stockholder of any of the Sellers their representations, warranties or covenants under this Agreement or in any certificate, schedule or exhibit delivered pursuant hereto;
(ii) any other breach of any representation or warranty of the Sellers contained in Company or any Principal Stockholder under this Agreement or in any agreementdocument, certificate certificate, schedule or other document exhibit delivered to the Buyer pursuant to this Agreement other than under Article III hereof (it being understood that the remedy for hereto, or by reason of any claim, action or proceeding asserted or instituted growing out of any matter or thing constituting a breach of any representation such representations or warranty under Section 2.8 hereof shall apply to Indemnifiable Losses only with respect to any federal or state Tax liability of Stealth attributable to periods (or any portion thereof) ending on or prior to the Closing and only to the extent such liabilities were not accrued and reserved for on the Closing Balance Sheet and taken into account in determining the Closing Net Worth)warranties; (ii) the breach by any of the Sellers of any agreement or covenant required by this Agreement or any other agreement executed in connection herewith to be performed by them other than the breach by any of the Sellers to perform any agreement or covenant under Article I hereof; and
(iii) any federal or state Tax liability breach of Stealth attributable to periods (any covenant of the Company or any portion thereof) ending on or prior to of the Closing but only to the extent such liabilities were not accrued and reserved for on the Closing Balance Sheet and taken into account in determining the Closing Net Worth; (iv) any products liability claims with respect to any product or component thereof manufactured by or shipped by Stealth, in whole Principal Stockholders under this Agreement or in partany document, prior to the Closing Date relating to actual injurycertificate, death schedule or physical damage to exhibit delivered pursuant hereto, or by reason of any person claim, action or property; proceeding asserted or instituted growing out of any matter or thing constituting a breach of such covenants.
(b) Claims under clauses (i), (ii) and (v) any returns of defective products or components under warranty manufactured by or shipped by Stealth in excess of seven percent (7%iii) of total product sales SECTION 9.1(a) are collectively referred to herein as "PURCHASER INDEMNIFIABLE CLAIMS", and Losses in any one year period prior respect of such claims are collectively referred to the Closing Date. The foregoing obligations to indemnify the Buyer will be determined without regard to any right to indemnification to which any Person may have in his or her capacity herein as an officer, director, employee, agent or any other capacity of Stealth, provided no Seller will be entitled to any indemnification from the Buyer or Stealth for amounts paid hereunder. There will be no right of contribution or subrogation from the Buyer or Stealth for indemnification payments made by or for the account of the Sellers"PURCHASER INDEMNIFIABLE LOSSES".
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Samples: Merger Agreement (Moldflow Corp)
INDEMNIFICATION BY THE PRINCIPAL STOCKHOLDERS. Subject Principal Stockholders shall, subject to the other provisions of this Article IX, the Principal StockholdersSection 7.4, jointly and severallyseverally indemnify, hereby agree except as to defendSRAC and SRAI, indemnify which shall be several and not joint, hold harmless and defend the Buyer harmless Parent, Merger Sub and the Company and their respective Affiliates, successors and assigns (collectively, “Parent’s Indemnified Persons”) from and against, and to reimburse the Buyer each of Parent’s Indemnified Persons with respect to, any and all losses, damagesdamages (including punitive and liquidated damages for labor or employment law violations), liabilities, claimsindemnification obligations, judgmentsamounts paid in settlement, settlementscleanup costs, costs and expenses, penalties, fines, costs and expenses (including reasonable attorneys’ fees, assessments, and fees and reasonable expenses of investigation) (“Indemnifiable Losses”), of every nature whatsoever incurred by the Buyer (which will be deemed incident to include, but without any duplicative indemnity, any of the foregoing or incurred in investigating or attempting to avoid the same or to oppose the imposition thereof or in enforcing this indemnification, but excluding any special, incidental, consequential, indirect or punitive damages (except when awarded for labor or employment law violations), including, without limitation, any damages for lost profits or loss of business (collectively, “Damages”) incurred by Stealthany of Parent’s Indemnified Persons (“Parent’s Damages”) caused by reason of or arising out of or in connection with with:
(i) the breach by any of the Sellers failure of any representation or warranty of the Sellers contained Company and the Stockholders made in this Agreement, the Escrow Agreement or any Related Document to be true and correct in all respects as of the date of this Agreement (or the date of the Escrow Agreement or Related Document, as applicable) and as of the Effective Time (disregarding for purposes of this Section 6.2(a) any “materiality”, “in all material respects”, “Material Adverse Effect”, “Knowledge” or similar qualifications as to materiality or knowledge contained therein or with respect thereto both for purposes of determining whether a representation or warranty is true and correct and for purposes of calculating Damages);
(ii) any litigation, liability or other claim, notice or demand (A) requiring or seeking the investigation, removal or remediation or the recovery of any costs arising therefrom, of any Hazardous Materials attributable to the conduct of the Businesses prior to the Effective Time or (B) arising out of any indemnification obligations set forth in any agreementcontracts to which the Company is a party (including, certificate but not limited to, those contracts set forth on Section 3.15 of Stockholders’ Disclosure Schedule);
(iii) any claims by any current or other document delivered former holder of Options or Warrants relating to or arising out of the transactions contemplated by this Agreement, this Agreement, or any Person’s status as an equity holder or ownership of equity interests in the Company at any time at or prior to the Buyer pursuant to this Agreement other than under Article III hereof (it being understood that the remedy Closing, whether for breach of fiduciary duty or otherwise (other than Company Indemnified Proceedings described in Section 8.11 below);
(iv) any representation payment in respect of Dissenting Shares in excess of (x) the consideration that otherwise would have been payable in respect of such shares in accordance with this Agreement and (y) any costs or warranty expenses (including attorneys’ fees, costs and expenses in connection with any action or proceeding or in connection with any investigation) in respect of any Dissenting Shares;
(v) any Damages of the Company arising under Section 2.8 hereof shall apply to Indemnifiable Losses only or with respect to the sale of assets to Subex Systems Limited;
(vi) the failure of any federal item set forth in the Certificate of Transaction Expenses or state Tax liability the Allocation Certificate to be true and correct in all respects as of Stealth attributable the Closing;
(vii) any claims by any Non-Principal Stockholders for failure to periods receive the Common Stock Per Share Merger Consideration for each share of Common Stock owned by them, as well as any claims that may arise from lost Certificates;
(viii) regardless of any disclosure on the Company’s Disclosure Schedule, any “excess parachute payment” (within the meaning of Section 280G(b) of the Code) made by the Company or any portion thereof) ending Subsidiary on or prior to the Closing and only Date or otherwise required to be paid by the extent such liabilities were not accrued and reserved for on Company or the Closing Balance Sheet and taken into account in determining Surviving Corporation pursuant to any contracts or agreements of the Closing Net Worth); (ii) the breach by Company or any of the Sellers of any agreement or covenant required by this Agreement its Subsidiaries or any other agreement executed in connection herewith to be performed by them other than the breach by any of the Sellers to perform any agreement Plan entered into or covenant under Article I hereof; (iii) any federal or state Tax liability of Stealth attributable to periods (or any portion thereof) ending adopted on or prior to the Closing but only to the extent such liabilities were not accrued and reserved for on the Closing Balance Sheet and taken into account in determining the Closing Net Worth; Date;
(ivix) any products liability claims with respect to any product or component thereof manufactured by or shipped by StealthDamages of the Company arising out of the matter set forth on Section 3.16 of the Company’s Disclosure Schedule involving Sotas, in whole or in part, prior to Taylar and Jawwal (as those terms are defined on said Section 3.16 of the Closing Date relating to actual injury, death or physical damage to any person or property; and Company’s Disclosure Schedule);
(vx) any returns Damages of defective products the Company arising out of disclosures set forth on Section 3.25 of the Company’s Disclosure Schedule;
(xi) any Change of Control Payments not otherwise considered in the adjustment to Merger Consideration pursuant to Section 1.10(ii); and
(xii) any failure by the Company or components under warranty manufactured the Principal Stockholders to perform any covenant required to be performed by or shipped by Stealth in excess of seven percent (7%) of total product sales in any one year period prior it pursuant to this Agreement, the Closing Date. The foregoing obligations to indemnify the Buyer will be determined without regard to any right to indemnification to which any Person may have in his or her capacity as an officer, director, employee, agent Escrow Agreement or any other capacity of Stealth, provided no Seller will be entitled to any indemnification from the Buyer or Stealth for amounts paid hereunder. There will be no right of contribution or subrogation from the Buyer or Stealth for indemnification payments made by or for the account of the SellersRelated Document.
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