Common use of Indemnification by the Seller Parties Clause in Contracts

Indemnification by the Seller Parties. From and after the Closing and subject to Section 11.1, the Seller Parties agree jointly and severally to indemnify, defend and hold harmless the Buyer Group Members from and against any and all Losses and Expenses imposed upon, or incurred or suffered by, any Buyer Group Member as a result of or arising out of or relating to or caused by: (i) any breach by any of the Seller Parties of, or any other failure of any of the Seller Parties to perform, any of their covenants, agreements or obligations pursuant to this Agreement or any Ancillary Agreements; (ii) any breach of or inaccuracy of any representation or warranty of any of the Seller Parties contained in this Agreement or any certificate delivered by or on behalf of any of the Seller Parties pursuant hereto; (iii) the Excluded Liabilities; or (iv) a Seller Party’s failure to comply with the terms and conditions of any bulk sales or bulk transfer or similar Laws of any jurisdiction that may be applicable to the sale or transfer of any or all of the Purchased Assets to the Buyer. provided, however, that in respect of the Non-Fundamental Representations, the Seller Parties shall not be required to indemnify and hold harmless pursuant to clause (ii) of this Section 9.1 with respect to Losses and Expenses imposed upon, or incurred or suffered by, the Buyer Group Members until, and then only to the extent that, the aggregate amount of all such Losses and Expenses exceed one percent (1%) of the Purchase Price (the “Deductible”); and, provided, further, that the aggregate amount of Losses and Expenses that the Seller Parties shall be required to indemnify and hold harmless pursuant to clause (ii) of this Section 9.1 in respect of Non-Fundamental Representations shall not exceed the Cap. For purposes of this Agreement, the “Cap” means (a) an amount equal to ten percent (10%) of the Purchase Price. For purposes of clarity, the Deductible and the Cap shall not apply to the Fundamental Representations. Any qualification of the representations and warranties of the Seller Parties or their Affiliates by reference to materiality or Material Adverse Effect, where applicable, relating to the matters stated therein, or words of similar effect, shall be disregarded in determining the amount of Losses and Expenses arising therefrom; provided that the foregoing shall not apply to Section 3.4(a).

Indemnification by the Seller Parties. From and after the Closing and subject to Section 11.1Except as otherwise limited by this Article IX, the Seller Parties agree Parties, jointly and severally to indemnifyseverally, defend shall indemnify and hold harmless the Buyer Group Members Purchaser and its Affiliates, parents, subsidiaries, officers, directors, employees, agents, independent contractor salespersons, successors and assigns (collectively, the “Purchaser Indemnified Parties”) from and against any and all Losses liabilities, losses, damages, claims, costs and Expenses imposed uponexpenses, interest, awards, judgments and penalties (whether or incurred or suffered by, any Buyer Group Member as a result of or not arising out of third-party claims) (including, without limitation, costs of mitigation, losses in connection with any Environmental Law, lost profits and other losses resulting from any shutdown or relating to curtailment of operations, reasonable attorneys’ fees and expenses and any and all amounts paid in investigation, defense or caused by: (i) any breach by any of the Seller Parties of, or any other failure of any of the Seller Parties to perform, any of their covenants, agreements or obligations pursuant to this Agreement or any Ancillary Agreements; (ii) any breach of or inaccuracy of any representation or warranty of any of the Seller Parties contained in this Agreement or any certificate delivered by or on behalf of any of the Seller Parties pursuant hereto; (iii) the Excluded Liabilities; or (iv) a Seller Party’s failure to comply with the terms and conditions of any bulk sales or bulk transfer or similar Laws of any jurisdiction that may be applicable to the sale or transfer settlement of any or all of the Purchased Assets to the Buyer. providedforegoing) (“Losses”), however, that in respect arising out of the Non-Fundamental Representations, or resulting from (i) any or all misrepresentations or breaches of warranty by the Seller Parties shall not be required to indemnify and hold harmless pursuant to clause contained herein or in any document delivered hereunder; (ii) the breach of this any or all covenants or agreements by the Seller Parties contained herein or in any document delivered hereunder; (iii) any Losses of the Purchaser arising out of or resulting from the failure of the Seller Parties to comply with any applicable bulk sales laws in the United States; (iv) any Retained Liabilities; (v) except to the extent constituting an Assumed Liability, or otherwise indemnifiable under Section 9.1 9.3, all Liabilities arising out of the ownership or operation of KNE, the Acquired Assets or the Business prior to the Closing Date; (vi) (A) relating to time periods prior to, on or after the Closing Date, resulting from or in connection with (x) the employment relationships of the KNE Lay-Off Employees and the termination of such employment relationships (including, without limitation, salary payments, bonus payments severance payments, social security charges, vacation entitlements, payments as a result of post-contractual non compete provisions, costs of any court proceedings) and (y) the KNE Lay-Off Employee Ancillary Contracts and the termination of such contracts (including, without limitation any payment obligations and other obligations towards the respective other parties to such contracts prior to their effective termination), and (B) relating to the time period prior to or on the Closing Date and resulting from or in connection with the employment relationships of the KNE Other Employees (including, without limitation, any payment obligations as a result of unpaid overtime); (vii) if the German Contract Condition is not satisfied prior to the Closing, any Liability of KNE arising as a result of the termination by KNE of the German Contract so long as such termination is made upon at least sixty (60) days prior written notice and is effective no later than February 1, 2010; and (viii) any Taxes of KNE with respect to Losses any Pre-Closing Tax Period and Expenses imposed uponthe unpaid Taxes of any Person (other than KNE) under Treasury Regulations Section 1.1502-6 (or any similar Laws), as a transferee or successor, by contract, or incurred or suffered by, the Buyer Group Members until, and then only to the extent that, the aggregate amount of all such Losses and Expenses exceed one percent (1%) of the Purchase Price (the “Deductible”); and, provided, further, that the aggregate amount of Losses and Expenses that the Seller Parties shall be required to indemnify and hold harmless pursuant to clause (ii) of this Section 9.1 in respect of Non-Fundamental Representations shall not exceed the Capotherwise. For purposes of this AgreementSection 9.2(viii), the “Cap” means Taxes of KNE for any Straddle Period shall be allocated as provided in Section 6.6(b). It is clarified, for the avoidance of doubt, that the Seller Parties’ indemnification obligation pursuant to (avi)(A) an amount equal to ten percent (10%) shall also apply in the event that a termination of the KNE Lay-Off Employees and/or the KNE Lay-Off Employee Ancillary Contracts is not legally possible, or is not effected by KNE in accordance with Section 6.8, or is effected by KNE only after the Closing Date and that such obligation shall include, without limitation, indemnification of the Purchaser and KNE for any payments required under the respective employment contract or KNE Lay-Off Employee Ancillary Contract through the effective termination of such contract. Notwithstanding the foregoing, in no event shall any Seller Party have any indemnification obligation pursuant to this Section 9.2 with respect to any Losses (or portion thereof) for which a liability or accrual has been reflected in the KNE Closing Balance Sheet for such Losses and taken into account in the Base Purchase Price Determination Certificate as a deduction in the calculation of the Final Purchase Price. For purposes of clarity, the Deductible and the Cap shall not apply to the Fundamental Representations. Any qualification of the representations and warranties of the Seller Parties or their Affiliates by reference to materiality or Material Adverse Effect, where applicable, relating to the matters stated therein, or words of similar effect, shall be disregarded in determining the amount of Losses and Expenses arising therefrom; provided that the foregoing shall not apply to Section 3.4(a).

Indemnification by the Seller Parties. (a) From and after the Closing and subject to Section 11.1Effective Time, the Seller Parties agree shall, jointly and severally to severally, indemnify, defend and hold harmless the Buyer Group Members Indemnitees from and against any and all Losses and Expenses imposed upon, suffered or incurred by any such indemnified party to the extent suffered or suffered byincurred in connection with, any Buyer Group Member as a result of or arising out of of, resulting from or relating incident to or caused by: (i) any breach by any of the Seller Parties of, or any other failure of any of the Seller Parties to perform, any of their covenants, agreements or obligations pursuant to this Agreement or any Ancillary Agreements; (ii) any breach of or inaccuracy of any representation or warranty of the Seller Parties made in or pursuant to this Agreement, (ii) any breach of any covenant or agreement of the Seller Parties contained made in or pursuant to this Agreement or any certificate delivered by or on behalf of any of the Seller Parties pursuant hereto; Agreement, (iii) the Excluded Liabilities; or , or (iv) a Seller Party’s failure to comply with the terms and conditions of any bulk sales or bulk transfer or similar Laws of any jurisdiction that may be applicable to the sale or transfer of any or all of the Purchased Assets to the Buyermatters set forth on Schedule 9.2(a). provided, however, that in respect of the Non-Fundamental Representations, the The Seller Parties shall not be required to indemnify and hold harmless pursuant to have any Liability under clause (iii) of this Section 9.1 with respect to Losses and Expenses imposed upon, or incurred or suffered by, the Buyer Group Members until, and then only to the extent that, above unless the aggregate amount of all such Losses and Expenses exceed one percent relating thereto for which the Seller Parties would, but for this proviso, be liable exclusively under clause (1%i) of the Purchase Price above, exceeds on a cumulative basis an amount equal to $315,000 (the “Deductible”); and, providedin which case, further, that the aggregate amount of Losses and Expenses that the Seller Parties shall be required to indemnify and hold harmless pursuant to liable only for the amount of Losses in excess of the Deductible; provided, that the Seller Parties’ aggregate liability for claims based exclusively on clause (iii) of this Section 9.1 above shall in respect of Non-Fundamental Representations shall not no event exceed the Cap. For purposes of this Agreement, $15,750,000 (the “Cap” means (a) an amount equal ”). Notwithstanding anything to ten percent (10%) of the Purchase Price. For purposes of claritycontrary set forth herein, the limitations on liability provided by the Deductible and the Cap shall not apply with respect to (x) Losses suffered or incurred by any such indemnified party in connection with, arising out of, resulting from or incident to a breach of any representation or warranty in Section 3.16 (Taxes) or any breach of any Fundamental Representation; or (y) claims based upon, for, or in connection with, fraud or intentional misrepresentation. (b) If the Fundamental Representations. Any qualification Holdback Amount is not sufficient to satisfy the Seller Parties’ indemnity obligations under this Agreement and this Agreement contemplates recovery in excess of the representations and warranties of Holdback Amount with respect to such claim, the Buyer Indemnitees may seek recovery directly from the Seller Parties or their Affiliates by reference with respect to materiality or Material Adverse Effectsuch Losses; provided, where applicablehowever, relating that the Seller Parties shall not be liable to the matters stated thereinBuyer Indemnitees for Losses arising with respect to any breach of, or words any inaccuracy in, any Fundamental Representation or any representation or warranty in Section 3.16 (Taxes) in excess of similar effectan amount equal to the sum of the Closing Cash Consideration plus the Closing Stock Consideration plus the Indemnity Holdback Amount (the “Maximum Amount”). (c) Notwithstanding the provisions of Section 9.2(a) or any other provision in this Agreement, if Buyer waives the Closing condition set forth in Section 2.2(g) with respect to a Consent identified in Schedule 2.2(g) not being obtained and in full force and effect and Buyer proceeds with the Closing, then Buyer shall be disregarded deemed to have waived any and all rights it and all other Buyer Indemnitees may have arising from, or relating to, any such Consent not being obtained and in determining full force and effect at the amount Closing (including the right to indemnification set forth in this Article 9); provided, that, to the extent that any such Consent is not obtained, the underlying Contract to such Consent shall be subject to the terms of Losses and Expenses arising therefrom; provided that the foregoing shall not apply to Section 3.4(a)6.8.

Indemnification by the Seller Parties. From (a) Subject to Sections 10.1 and 10.7 hereof, from and after the Closing and subject to Section 11.1Closing, the Seller Parties agree Parties, jointly and severally severally, agree to indemnifydefend, defend indemnify and hold harmless the Buyer Group Members from and against any its Affiliates and their respective officers, directors, managers, members, employees, agents, advisors and representatives (each hereinafter referred to individually as a “Buyer Indemnified Person” and collectively as “Buyer Indemnified Persons”), from, against, and in respect of all Losses and Expenses imposed uponresulting from, arising out of, relating to, or incurred or suffered by, caused by any Buyer Group Member as a result of or arising out of or relating to or caused by: the following: (i) any failure of any representations and warranties made by the Seller Parties in Article 3 hereof to be true and correct as of the date of this Agreement and as of the Closing Date as though made on and as of the Closing Date; (ii) any breach by any of the Seller Parties of, or any other failure of any of by the Seller Parties to perform, carry out or otherwise fulfill or comply with, any of their its respective covenants, agreements agreements, undertakings or obligations pursuant contained in this Agreement, (iii) the Retained Liabilities, including any failure by the Seller Parties to this Agreement carry out, perform or otherwise fulfill any Ancillary Agreements;of the Retained Liabilities; or (iv) the Excluded Assets. (iib) any Any claim for indemnification made by a Buyer Indemnified Person under Section 10.2(a)(i) for a breach of or inaccuracy of any representation or warranty of any of must be asserted with reasonable particularity in a writing delivered to the Seller Parties contained by no later than the date of expiration of the applicable Survival Period for such representation or warranty and, if raised by such date, such claim shall survive such date until final resolution thereof. (c) The representations and warranties made by the Seller Parties in Article 3 of this Agreement shall not be affected or deemed waived by reason of any certificate delivered investigation made by or on behalf of Buyer (including by any of the Seller Parties pursuant hereto; (iii) the Excluded Liabilities; or (iv) a Seller Partyits Affiliates or Buyer’s failure to comply with the terms and conditions of any bulk sales or bulk transfer its Affiliate’s stockholders, members, advisors, consultants, agents or similar Laws of any jurisdiction that may be applicable to the sale or transfer of any or all of the Purchased Assets to the Buyer. provided, however, that in respect of the Non-Fundamental Representations, the Seller Parties shall not be required to indemnify and hold harmless pursuant to clause (ii) of this Section 9.1 with respect to Losses and Expenses imposed upon, or incurred or suffered by, the Buyer Group Members until, and then only to the extent that, the aggregate amount of all such Losses and Expenses exceed one percent (1%) of the Purchase Price (the “Deductible”); and, provided, further, that the aggregate amount of Losses and Expenses that the Seller Parties shall be required to indemnify and hold harmless pursuant to clause (ii) of this Section 9.1 in respect of Non-Fundamental Representations shall not exceed the Cap. For purposes of this Agreement, the “Cap” means (a) an amount equal to ten percent (10%) of the Purchase Price. For purposes of clarity, the Deductible and the Cap shall not apply to the Fundamental Representations. Any qualification of the representations and warranties of the Seller Parties or their Affiliates by reference to materiality or Material Adverse Effect, where applicable, relating to the matters stated therein, or words of similar effect, shall be disregarded in determining the amount of Losses and Expenses arising therefrom; provided that the foregoing shall not apply to Section 3.4(arepresentatives).

Indemnification by the Seller Parties. From and after the Closing and subject to Section 11.1, the The Seller Parties agree and their respective successors and assigns shall, jointly and severally to severally, indemnify, defend defend, reimburse and hold harmless the Buyer Group Members and its successors and assigns, and the officers, directors, employees and agents of each of them (each, a "BUYER INDEMNITEE" and collectively, the "BUYER INDEMNITEES"), from and against any and all Losses claims, losses, damages, liabilities, obligations, assessments, penalties and Expenses imposed uponinterest, demands, actions and expenses, whether direct or indirect (including, without limitation, settlement costs, legal and accounting fees and expenses and any other expenses for investigating or defending any actions or threatened actions) ("LOSSES") incurred or suffered byby any such Buyer Indemnitee, any Buyer Group Member as a result of or arising out of or relating to or caused byin connection with any of the following: (ia) the ownership or operation of the Business and/or Acquired Assets on or prior to the Closing; (b) any breach material misstatement or omission with respect to any representation or warranty made by any of the Seller Parties of, or any other failure of any of the Seller Parties to perform, any of their covenants, agreements or obligations pursuant to in this Agreement or any Ancillary Agreementsother Transaction Document; (iic) any material breach of any covenant, representation, warranty, agreement or inaccuracy of any representation or warranty of any obligation of the Seller Parties contained in this Agreement or Exhibit A or Exhibit B hereto.; (d) any certificate delivered product liability claims against the Buyer relating to the ownership, sale and/or operation of the Acquired Assets by or on behalf of any of the Seller Parties pursuant heretoon or prior to the Closing; (iiie) all taxes due or payable by the Excluded Liabilities; orSeller Parties with respect to the Business or SB&S for periods (or portions thereof) ending prior or subsequent to the date hereof, except to the extent assumed by the Buyer; (ivf) a Seller Party’s failure to comply with the terms and conditions of any bulk sales claims against, or bulk transfer liabilities or similar Laws of any jurisdiction that may be applicable to the sale or transfer of any or all of the Purchased Assets to the Buyer. provided, however, that in respect of the Non-Fundamental Representationsobligations of, the Seller Parties shall not be required to indemnify and hold harmless specifically assumed by the Buyer pursuant to clause (ii) of this Section 9.1 with respect to Losses and Expenses imposed upon, or incurred or suffered by, the Buyer Group Members until, and then only to the extent that, the aggregate amount of all such Losses and Expenses exceed one percent (1%) of the Purchase Price (the “Deductible”); and, provided, further, that the aggregate amount of Losses and Expenses that the Seller Parties shall be required to indemnify and hold harmless pursuant to clause (ii) of this Section 9.1 in respect of Non-Fundamental Representations shall not exceed the Cap. For purposes of this Agreement, the “Cap” means (a) an amount equal to ten percent (10%) of the Purchase Price. For purposes of clarity, the Deductible and the Cap shall not apply to the Fundamental Representations. Any qualification of the representations and warranties of the Seller Parties or their Affiliates by reference to materiality or Material Adverse Effect, where applicable, relating to the matters stated therein, or words of similar effect, shall be disregarded in determining the amount of Losses and Expenses arising therefrom; provided that the foregoing shall not apply to Section 3.4(a).

Indemnification by the Seller Parties. From If an Alliant Indemnified Party suffers Adverse Consequences arising out of, based upon or relating to any breach by the Seller Parties of their representations, warranties, or covenants contained herein and after if in any such case such Alliant Indemnified Party delivers a written claim for indemnification to the Closing and Seller Parties in the manner set forth in Section 10.6 within the relevant survival period (if any), then subject to Section 11.1the other terms and conditions contained in this Article IX, the Seller Parties agree jointly and severally to indemnify, defend and hold harmless the Buyer Group Members indemnify such Alliant Indemnified Party from and against any such Adverse Consequences (to the extent provided for hereunder, and all Losses regardless of whether such Adverse Consequences arise from or involve a Third Party Claim) that it may suffer through and Expenses imposed upon, or incurred or suffered by, after the date of the claim for indemnification (including any Buyer Group Member as a result Adverse Consequences that the Alliant Indemnified Party may suffer after the end of or arising out of or relating any applicable survival period). (a) Notwithstanding anything to or caused bythe contrary herein: (i) any In the event of a breach by any of the Seller Parties of, or any other failure of any of the Seller Parties to perform, any of their covenants, agreements or obligations pursuant to this Agreement or any Ancillary Agreements; (ii) any breach of or inaccuracy of any representation or warranty of any of the Seller Parties contained in this Agreement or any certificate delivered by or on behalf of any of the Seller Parties pursuant hereto; (iii) the Excluded Liabilities; or (iv) a Seller Party’s failure to comply with the terms and conditions of any bulk sales or bulk transfer or similar Laws of any jurisdiction that may be applicable to the sale or transfer of any or all of the Purchased Assets to the Buyer. provided, however, that in respect of the Non-Fundamental Parties’ Basic Representations, the Seller Parties shall not be required have any obligation to indemnify and hold harmless pursuant to clause (ii) of this Section 9.1 with respect to Losses and Expenses imposed uponany Alliant Indemnified Party until all the Alliant Indemnified Parties have suffered aggregate Adverse Consequences that result from, arise out of, or incurred or suffered by, otherwise relate to all breaches by the Buyer Group Members until, and then only to the extent that, the aggregate amount Seller Parties of all such Losses and Expenses exceed one percent (1%) their Basic Representations in excess of the Purchase Price (the “Deductible”); andBasic Indemnification Threshold, provided, further, that the aggregate amount of Losses and Expenses that in which event the Seller Parties shall be required obligated to indemnify and hold harmless pursuant such Alliant Indemnified Party only for the amount of such Adverse Consequences above the Basic Indemnification Threshold, subject to clause the applicable limits otherwise set forth in this Article IX. For the avoidance of doubt, the Basic Indemnification Threshold shall not apply in the event of a breach by the Seller Parties of any of the Fundamental Representations, Special Representations, or covenants contained herein, or with respect to any Special Indemnification Matter. (ii) of this Section 9.1 in respect of Non-Fundamental Representations shall not exceed the Cap. For purposes of this Agreement, the “Cap” means (a) an amount equal to ten percent (10%) of the Purchase Price. For purposes of clarity, the Deductible and the Cap shall not apply to the Fundamental Representations. Any qualification of the representations and warranties The aggregate liability of the Seller Parties for all breaches of the Seller Parties Basic Representations shall in no event exceed the Basic Indemnification Cap. (iii) The aggregate liability of the Seller Parties for all breaches of the Seller Parties Basic Representations, Fundamental Representations, Special Representations and any covenants contained herein shall in no event exceed the aggregate Purchase Price paid or their Affiliates by reference to materiality or Material Adverse Effect, where applicable, relating that may become payable to the matters stated therein, or words of similar effect, Seller Parties under this Agreement (as adjusted by Section 2.4). (iv) There shall be disregarded in determining the amount no limitation on liability of Losses and Expenses arising therefrom; provided that the foregoing shall not apply any Seller Party with respect to Section 3.4(a)any Special Indemnification Matter.

Indemnification by the Seller Parties. From (a) Subject to the terms and conditions of this Article IX, from and after the Closing and subject to Section 11.1Closing, the Seller Parties agree jointly and severally to indemnify, defend indemnify and hold harmless the Buyer, its directors, officers, representatives, employees and Subsidiaries (each, a “Buyer Group Members from Indemnified Party”) from, against and against in respect of any and all Losses and Expenses imposed uponincurred by any Buyer Indemnified Party resulting from, or incurred that exist or suffered byarise due to, any of the following (collectively, “Buyer Group Member as a result of or arising out of or relating to or caused by:Claims”): (i) prior to its expiration in accordance with Section 9.1, the breach of any breach representation or warranty made by any of the Seller Parties of, or any other failure of any of the Seller Parties to perform, any of their covenants, agreements or obligations pursuant to Property Owner in this Agreement or any Ancillary AgreementsDocument; (ii) any prior to its expiration in accordance with Section 9.1, the breach of by the Seller or inaccuracy the Property Owner of any representation covenant or warranty of any of the Seller Parties contained in agreement under this Agreement or any certificate delivered by or on behalf of any of the Seller Parties pursuant heretoAncillary Document; (iii) the Excluded conduct and operation of the Business or the use or ownership of the Purchased Assets on or before the Closing Date (subject to Section 2.3(a) (Assumed Liabilities) and the Buyer’s indemnification obligations with respect to the Assumed Liabilities set forth in Section 9.3(a)(iii)); orand (iv) a Seller Party’s failure to comply with the terms and conditions of any bulk sales or bulk transfer or similar Laws of any jurisdiction that may be applicable Excluded Liabilities. (b) Notwithstanding anything contained herein to the sale or transfer contrary, the obligations of any or all of the Purchased Assets to the Buyer. provided, however, that in respect of the Non-Fundamental Representations, the Seller Parties shall not be required to indemnify and hold harmless pursuant to clause Section 9.2(a)(i) shall: (iii) of this Section 9.1 with respect not apply to Losses and Expenses imposed upon, or incurred or suffered by, the any Buyer Group Members Claims until, and then only to the extent that, the aggregate amount of Losses incurred by all such Losses Buyer Indemnified Parties exceeds $100,000; and Expenses exceed one percent (1%ii) of the Purchase Price (the “Deductible”); andbe limited to, providedand shall not exceed, further, that the aggregate amount of Losses and Expenses that $1,000,000. Notwithstanding the Seller Parties shall be required to indemnify and hold harmless pursuant to clause (ii) of foregoing, the limitations set forth in this Section 9.1 in respect of Non-Fundamental Representations shall not exceed the Cap. For purposes of this Agreement, the “Cap” means (a9.2(b) an amount equal to ten percent (10%) of the Purchase Price. For purposes of clarity, the Deductible and the Cap shall not apply to Buyer Claims resulting from (1) the Fundamental Representations. Any qualification breach of the representations and warranties any Special Representation or Warranty of the Seller Parties or the Property Owner or (2) actual fraud by the Seller, the Property Owner or their Affiliates in connection with the transactions contemplated by reference to materiality or Material Adverse Effect, where applicable, relating to the matters stated therein, or words of similar effect, shall be disregarded in determining the amount of Losses and Expenses arising therefrom; provided that the foregoing shall not apply to Section 3.4(a)this Agreement.