Indemnification by the Shareholder. The Shareholders agree to indemnify and hold harmless Parent, the Surviving Corporation and their respective successors and assigns (the "PARENT INDEMNITEES") from and against any and all Losses and Expenses incurred by such Parent Indemnitees in connection with or arising from: (a) Any breach by the Company of any of its covenants in this Agreement or in any Company Ancillary Document, or any failure of the Company to perform any of its obligations in this Agreement or in any Company Ancillary Document; PROVIDED, HOWEVER, with respect to the Company, this indemnification is limited to breaches of agreements and covenants to be performed by the Company on or prior to the Closing Date; (b) Any breach of any warranty or the inaccuracy of any representation regarding the Company contained in ARTICLE IV or referred to in the Agreement or any certificate delivered by or on behalf of the Company pursuant hereto, except for the representations and warranties contained in Section 4.20; and (c) the exercise of dissenters' rights by any shareholder of the Company; PROVIDED, HOWEVER, that the Shareholders shall be required to indemnify and hold harmless under clauses (a) and (b) of this Section with respect to Losses and Expenses incurred by the Parent Indemnitees, only if the aggregate amount of such Losses and Expenses exceeds $25,000 (the "THRESHOLD AMOUNT"), in which case the Shareholders shall be obligated to indemnify Parent Indemnitees for the entire amount of the Losses and Expenses from the first dollar; PROVIDED, FURTHER, that the aggregate maximum amount required to be paid by the Shareholders pursuant to this SECTION 9.1 hereunder shall not exceed the value of the shares of Preferred Stock and the shares of Common Stock in payment of the Awards, determined in accordance with SECTION 9.4(c) (the "INDEMNIFICATION LIMIT"). The indemnification provided for in this SECTION 9.1 shall terminate fifteen (15) months after the Closing Date (and no claims shall be made by the Parent Indemnitees under this SECTION 9.1(b) thereafter), except that the indemnification by Shareholders shall continue as to: (a) The representations and warranties set forth in SECTIONS 4.11 (title to assets), as to all of which no time limitation shall apply; (b) The representations and warranties set forth in SECTIONS 4.15 (ERISA), and 4.14 (Taxes), which shall survive for the applicable statute of limitations period under which a claim can be brought against Parent or the Company; and (c) Any Loss or Expense of which any Parent Indemnitee has notified the Shareholder in accordance with the requirements of SECTION 9.4 on or prior to the date such indemnification would otherwise terminate in accordance with this SECTION 9.1, as to which the obligation of Shareholder shall continue until the liability of Shareholder shall have been determined pursuant to this ARTICLE IX, and Shareholder shall have reimbursed all Parent Indemnitees for the full amount of such Loss and Expense in accordance with this ARTICLE IX. To the extent any Parent Indemnitee is entitled to indemnification pursuant to this SECTION 9.1, Shareholder, their successors and assigns hereby forever waive, release and agree not to make any claim or bring any cost recovery action against the Parent Indemnitees, successors and assigns under any director or officer indemnity agreement, or provision in law or under the Company's Certificate of incorporation or by-laws or under CERCLA or any other Environmental Law to the extent that such claim or cost recovery action relates to the same matter as constitutes the basis for such Parent Indemnitees' claim for indemnification.
Appears in 1 contract
Indemnification by the Shareholder. The Shareholders agree to Shareholder (for purposes of this Section 9.3, "Indemnitor"), shall indemnify and hold harmless ParentAHC, the Surviving Corporation AHC Sub and their respective successors officers, directors, shareholders, agents and assigns employees (each of the foregoing for purposes of this Section 9.3, an "PARENT INDEMNITEESIndemnified Person") ), harmless from and against any and all Losses and Expenses incurred Damages (i) arising from or by such Parent Indemnitees in connection with reason of or arising from:
(a) Any resulting from any breach by the Company Indemnitor of any of its covenants representation, warranty, agreement or covenant contained in this Agreement (including the Schedules and Exhibits hereto) and each document, certificate or other instrument furnished or to be furnished by Indemnitor hereunder, (ii) any claims whatsoever by Shareholder's father, Robexx X. Xxxxx, xx any other person asserting that it owns an equity interest, or has a contingent arrangement with respect to acquiring an equity interest, the Company, including, without limitation, any claims under or in any Company Ancillary Documentway arising out of that certain Stock Purchase Agreement dated August 29, 1995, by and between Robexx X. Xxxxx xxx Shareholder, (iii) any liabilities, contingent or any failure otherwise (known or unknown and asserted or unasserted) arising out of the Company to perform any of its obligations in this Agreement transactions effected or in any Company Ancillary Document; PROVIDED, HOWEVER, with respect to the Company, this indemnification is limited to breaches of agreements and covenants to be performed by the Company events occurring on or prior to the Closing Date;
(b) Any breach of any warranty or the inaccuracy of any representation regarding the Company contained in ARTICLE IV or referred to , except as set forth in the Agreement Balance Sheet or any certificate delivered by or incurred in the ordinary course of business since the Balance Sheet Date and except if disclosed on behalf of a Schedule hereto (unless set forth on Schedule 9.3); and (iv) the Company pursuant heretomatters described on Schedule 9.3; provided, however that except for the representations and warranties contained in Section 4.20; and
a claim relating to (cii) the exercise of dissenters' rights by any shareholder of the Company; PROVIDEDabove or tax or environmental matters, HOWEVER, that the Shareholders no claim shall be required to indemnify and hold harmless made for Damages under clauses (a) and (b) of this Section with respect 9.3 until, and such claims may be made only to Losses the extent that, the dollar amount of all such Damages shall exceed in the aggregate $50,000; and Expenses incurred by the Parent Indemniteesprovided further, only if however, indemnification for Damages under this Section 9.3 shall not exceed the aggregate amount of such Losses and Expenses exceeds $25,000 (the "THRESHOLD AMOUNT")Merger Consideration. In connection with Indemnitor's obligation to indemnify for expenses, in which case the Shareholders any Indemnified Person shall be obligated entitled to indemnify Parent Indemnitees for offset the entire amount of any Damages against the unpaid balance of the Note, upon written notice to Indemnitor of the amount and cause of such Damages, and the unpaid principal amount of the Losses and Expenses from Note shall be reduced by the first dollar; PROVIDEDamount of such Damages, FURTHERprovided, that such Indemnified Person agrees in writing to refund all such offset expenses if and to the aggregate maximum amount required extent that it is finally judicially determined that such Indemnified Person is not entitled to be paid by indemnification hereunder. In the Shareholders pursuant to this SECTION 9.1 hereunder shall not exceed event that the value balance of the shares of Preferred Stock and the shares of Common Stock in payment of the Awards, determined in accordance with SECTION 9.4(c) (the "INDEMNIFICATION LIMIT"). The indemnification provided for in this SECTION 9.1 shall terminate fifteen (15) months after the Closing Date (and no claims shall be made by the Parent Indemnitees under this SECTION 9.1(b) thereafter), except that the indemnification by Shareholders shall continue as to:
(a) The representations and warranties set forth in SECTIONS 4.11 (title Note at such time is insufficient to assets), as to all of which no time limitation shall apply;
(b) The representations and warranties set forth in SECTIONS 4.15 (ERISA), and 4.14 (Taxes), which shall survive for the applicable statute of limitations period under which a claim can be brought against Parent or the Company; and
(c) Any Loss or Expense of which any Parent Indemnitee has notified the Shareholder in accordance with the requirements of SECTION 9.4 on or prior to the date such indemnification would otherwise terminate in accordance with this SECTION 9.1, as to which the obligation of Shareholder shall continue until the liability of Shareholder shall have been determined pursuant to this ARTICLE IX, and Shareholder shall have reimbursed all Parent Indemnitees for cover the full amount of such Loss Damages, Indemnitor shall reimburse each Indemnified Person for any remaining unoffset Damages as they may be incurred by such Indemnified Person, provided, that such Indemnified Person agrees in writing to refund all such reimbursed expenses if and Expense in accordance with this ARTICLE IX. To the extent any Parent Indemnitee is entitled to indemnification pursuant to this SECTION 9.1, Shareholder, their successors and assigns hereby forever waive, release and agree not to make any claim or bring any cost recovery action against the Parent Indemnitees, successors and assigns under any director or officer indemnity agreement, or provision in law or under the Company's Certificate of incorporation or by-laws or under CERCLA or any other Environmental Law to the extent that it is finally judicially determined that such claim or cost recovery action relates Indemnified Person is not entitled to the same matter as constitutes the basis for such Parent Indemnitees' claim for indemnificationindemnification hereunder.
Appears in 1 contract
Indemnification by the Shareholder. The Shareholders agree to indemnify and hold harmless Parent, the Surviving Corporation and their respective successors and assigns (the "PARENT INDEMNITEES") from and against any and all Losses and Expenses incurred by such Parent Indemnitees in connection with or arising from:
(a) Any breach by the Company The Shareholder hereby covenants and agrees with SAC that, regardless of any of its covenants in this Agreement or in investigation made at any Company Ancillary Document, or any failure of the Company to perform any of its obligations in this Agreement or in any Company Ancillary Document; PROVIDED, HOWEVER, with respect to the Company, this indemnification is limited to breaches of agreements and covenants to be performed by the Company on or prior to the Closing Date;
(b) Any breach of any warranty or the inaccuracy of any representation regarding the Company contained in ARTICLE IV or referred to in the Agreement or any certificate delivered time by or on behalf of SAC or any information SAC may have and, regardless of the Company pursuant heretoClosing hereunder, provided that proper and timely notice is given in accordance with Sections 12.1 and 12.4, the Shareholder shall indemnify SAC and AJAX and their respective directors, officers, employees and Affiliates and each of their successors and assigns (individually,
a " SAC Indemnified Party"), and hold them harmless from, against and in respect of any and all direct, actual and non-consequential costs, losses, claims, liabilities, fines, penalties, damages and expenses (including interest which may be imposed in connection therewith, court costs and reasonable fees and disbursements of counsel; collectively "Losses") incurred by any of them resulting from any misrepresentation, breach of warranty or nonfulfillment of any agreement, covenant or obligation by the Shareholder made in this Agreement (including without limitation any Exhibit hereto and any certificate or instrument delivered in connection herewith).
(b) There shall be no obligation on the part of Shareholder to indemnify or hold a SAC Indemnified Party harmless, except to the extent the sum of all Losses (other than Losses relating to Taxes which are the subject of the following paragraph) for which SAC Indemnified Parties seek to be indemnified exceeds $250,000 (the representations and warranties contained "General Basket"), in Section 4.20; andwhich event Shareholder shall be responsible for all Losses in excess of $250,000.
(c) There shall be no obligation on the exercise part of dissenters' rights by any shareholder Shareholder to indemnify or hold a SAC Indemnified party harmless with respect to Losses arising out of or related to Taxes ("Tax Losses") except to the Company; PROVIDED, HOWEVER, extent that the Shareholders Tax Losses exceed $50,000 (the "Tax Basket"), in which event Shareholder shall be required responsible for all such Tax Losses without regard to indemnify and hold harmless under clauses the Tax Basket.
(ad) Neither the General Basket nor the Tax Basket shall be applicable with respect to a breach of Sections 5.1, 5.2, 5.3 or 5.7(a) and (b) of this Section and Shareholder's liability with respect to Losses and Expenses incurred by the Parent Indemnitees, only if the aggregate amount of such Losses and Expenses exceeds $25,000 (the "THRESHOLD AMOUNT"), in which case the Shareholders sections shall be obligated to indemnify Parent Indemnitees for in effect without any "Basket."
(e) In determining whether Shareholder has any obligation under the entire amount of the Losses and Expenses from the first dollar; PROVIDED, FURTHER, that the aggregate maximum amount required to be paid by the Shareholders pursuant to this SECTION 9.1 hereunder shall not exceed the value of the shares of Preferred Stock and the shares of Common Stock in payment of the Awards, determined in accordance with SECTION 9.4(c) (the "INDEMNIFICATION LIMIT"). The indemnification provided for in this SECTION 9.1 shall terminate fifteen (15) months after the Closing Date (and no claims shall be made by the Parent Indemnitees under this SECTION 9.1(b) thereafter), except that the indemnification by Shareholders shall continue as to:
foregoing subparagraphs (a) The representations and warranties set forth in SECTIONS 4.11 through (title to assetsd), as to all of which no time limitation and, if so, the amount thereof, there shall apply;be deducted from any Loss or Tax Loss
(bi) The representations and warranties set forth the proceeds of any insurance in SECTIONS 4.15 (ERISA), and 4.14 (Taxes), which shall survive for respect of the applicable statute of limitations period under which a claim can be brought against Parent or the Company; and
(c) Any incident giving rise to such Loss or Expense Tax Loss and (ii) the net cash effect of which any Parent Indemnitee has notified tax benefit received by Ajax in respect of any Loss or Tax Loss, offset by the cash effect of any tax burden resulting from payments made by Shareholder in accordance with the requirements of SECTION 9.4 on or prior to the date such indemnification would otherwise terminate in accordance with this SECTION 9.1, as to which the obligation of Shareholder shall continue until the liability of Shareholder shall have been determined pursuant to this ARTICLE IX, and Shareholder shall have reimbursed all Parent Indemnitees for the full amount of such Loss and Expense in accordance with this ARTICLE IXSection 12. To the extent any Parent Indemnitee is entitled to indemnification pursuant to this SECTION 9.1, Shareholder, their successors and assigns hereby forever waive, release and agree not to make any claim or bring any cost recovery action against the Parent Indemnitees, successors and assigns under any director or officer indemnity agreement, or provision in law or under the Company's Certificate of incorporation or by-laws or under CERCLA or any other Environmental Law to the extent that such claim or cost recovery action relates to the same matter as constitutes the basis for such Parent Indemnitees' claim for indemnification.12.1.2
Appears in 1 contract
Samples: Stock Purchase and Redemption Agreement (Standard Automotive Corp)
Indemnification by the Shareholder. The Shareholders agree to ---------------------------------- Shareholder shall indemnify and hold harmless Parentthe Purchaser and the Company and each of their officers, directors, employees, shareholders and affiliates (collectively, the Surviving Corporation and their respective successors and assigns (the "PARENT INDEMNITEESPurchaser Indemnified Parties") from and against any and all Losses and losses, claims, assessments, demands, damages, liabilities, obligations, costs and/or expenses whatsoever (hereinafter referred to collectively as the "Purchaser's Damages"), including, without limitation, Purchaser's Counsel Expenses (as hereinafter defined), sustained or incurred by such Parent Indemnitees in connection with any of the Purchaser Indemnified Parties as a result of or arising from:
from (ai) Any the breach by the Company of any of its the obligations, covenants in this Agreement or in any Company Ancillary Documentprovisions of, or any failure of the Company to perform any of its obligations in this Agreement or in any Company Ancillary Document; PROVIDED, HOWEVER, with respect to the Company, this indemnification is limited to breaches of agreements and covenants to be performed by the Company on or prior to the Closing Date;
(b) Any breach of any warranty or the inaccuracy of any representation regarding of the representations or warranties made by, the Company contained in ARTICLE IV or referred to in the Agreement or Shareholder herein, (ii) any certificate delivered by or on behalf claim asserted against any of the Purchaser Indemnified Parties with respect to the Computer Software and (iii) any claim asserted against any of the Purchaser Indemnified Parties arising out of the Employment Agreement dated as of April 27, 1997 between the Company pursuant heretoand Xxxxxxxx Xxxxxxxxx. For purposes hereof "Purchaser's Counsel Expenses" shall mean reasonable fees and disbursements of counsel howsoever sustained or incurred by any of the Purchaser Indemnified Parties, except for including, without limitation, in any action or proceeding between any of the representations Purchaser Indemnified Parties and warranties the Shareholder or in any action or proceeding between any of the Purchaser Indemnified Parties and any third party. In addition to the right of the Purchaser to indemnification hereunder, the Purchaser shall have the right from time to time to set off the amount of any of the Purchaser's Damages against any payments of principal and/or interest due and payable to the Shareholder under the Note and/or the Earn-Out Payments; provided, however, that the -------- ------- Purchaser agrees that it will not exercise its right to set off under this Section X(A) the amount of any of the Purchaser's Damages which it may sustain or incur by reason of a breach of the Shareholder's covenants contained in Section 4.20; and
(c) XI hereof. The Purchaser shall place into escrow any amounts it is seeking to set off with an escrow agent mutually agreeable to the exercise Shareholder and the Purchaser. Any amounts of dissenters' rights by any shareholder of the Company; PROVIDED, HOWEVER, that the Shareholders shall be required to indemnify and hold harmless under clauses (a) and (b) of this Section with respect to Losses and Expenses incurred cash set off by the Parent Indemnitees, only if the aggregate amount of such Losses and Expenses exceeds $25,000 (the "THRESHOLD AMOUNT"), in Purchaser which case the Shareholders shall be obligated are later awarded to indemnify Parent Indemnitees for the entire amount of the Losses and Expenses from the first dollar; PROVIDED, FURTHER, that the aggregate maximum amount required to be paid by the Shareholders pursuant to this SECTION 9.1 hereunder shall not exceed the value of the shares of Preferred Stock and the shares of Common Stock in payment of the Awards, determined in accordance with SECTION 9.4(c) (the "INDEMNIFICATION LIMIT"). The indemnification provided for in this SECTION 9.1 shall terminate fifteen (15) months after the Closing Date (and no claims shall be made by the Parent Indemnitees under this SECTION 9.1(b) thereafter), except that the indemnification by Shareholders shall continue as to:
(a) The representations and warranties set forth in SECTIONS 4.11 (title to assets), as to all of which no time limitation shall apply;
(b) The representations and warranties set forth in SECTIONS 4.15 (ERISA), and 4.14 (Taxes), which shall survive for the applicable statute of limitations period under which a claim can be brought against Parent or the Company; and
(c) Any Loss or Expense of which any Parent Indemnitee has notified the Shareholder in accordance with the requirements Section XIII(G) hereof, shall accrue interest at a rate of SECTION 9.4 on or prior to the date such indemnification would otherwise terminate in accordance with this SECTION 9.1, as to which the obligation of Shareholder shall continue until the liability of Shareholder shall have been determined pursuant to this ARTICLE IX, and Shareholder shall have reimbursed all Parent Indemnitees for the full amount of such Loss and Expense in accordance with this ARTICLE IX. To the extent any Parent Indemnitee is entitled to indemnification pursuant to this SECTION 9.1, Shareholder, their successors and assigns hereby forever waive, release and agree not to make any claim or bring any cost recovery action against the Parent Indemnitees, successors and assigns under any director or officer indemnity agreement, or provision in law or under the Company's Certificate of incorporation or by-laws or under CERCLA or any other Environmental Law to the extent that such claim or cost recovery action relates to the same matter as constitutes the basis for such Parent Indemnitees' claim for indemnification.six and
Appears in 1 contract
Samples: Purchase and Sale Agreement (Cultural Access Worldwide Inc)
Indemnification by the Shareholder. The Shareholders agree Subject to indemnify the terms and conditions of this Section, the Shareholder hereby agrees to indemnify, defend and hold harmless ParentLKQ and its affiliates from, the Surviving Corporation against, for, and their respective successors and assigns (the "PARENT INDEMNITEES") from and against in respect of any and all Losses expenses, losses, costs, deficiencies, liabilities and Expenses damages (including related counsel fees and expenses) (collectively, “Damages”) incurred or suffered by such Parent Indemnitees in connection with them by reason of, resulting from, based upon or arising from:
out of (ai) Any breach by the Company any inaccuracy, untruth, or incompleteness of any representation or warranty of its covenants the Shareholder contained in or made pursuant to this Agreement or in any Company Ancillary Documentcertificate, schedule or exhibit prepared by the Shareholder in connection herewith, (ii) any breach or partial breach of any covenant or agreement made by the Shareholder in this Agreement, or (iii) any failure claim relating to any Environmental Law and based upon the actions of the Company to perform any of its obligations in this Agreement or in any Company Ancillary Document; PROVIDED, HOWEVER, with respect to the Company, this indemnification is limited to breaches of agreements and covenants to be performed by the Company on or Shareholder prior to the Closing Date;, including matters disclosed in the Disclosure Schedule.
(b) Any breach 9.1.1 LKQ shall be entitled to recover Damages arising out of any warranty or the inaccuracy or untruth of any representation regarding the Company contained in ARTICLE IV or referred to in the Agreement or any certificate delivered by or on behalf warranty of the Company pursuant hereto, except for the representations and warranties contained in Section 4.20; and
(c) the exercise of dissenters' rights by any shareholder of the Company; PROVIDED, HOWEVER, that the Shareholders shall be required to indemnify and hold harmless under clauses (a) and (b) of this Section with respect to Losses and Expenses incurred by the Parent Indemnitees, Shareholder only if the aggregate amount of all such Losses and Expenses Damages exceeds $25,000 (50,000, but shall then be entitled to recover all such Damages, including such $50,000 amount, provided that LKQ shall not be entitled to recover Damages exceeding the "THRESHOLD AMOUNT")Purchase Price; and provided further that such maximum aggregate limitation on recoverable Damages shall not apply to any claim based upon a breach of the representations and warranties made in Article 4 resulting from fraud or actually known by the Shareholder at the Closing Date and not disclosed.
9.1.2 Except as otherwise provided in Section 9.1.3, each of the representations and warranties made by the Shareholder in which case this Agreement or pursuant hereto shall survive until the Shareholders second anniversary of the Closing Date. No claim for the recovery of Damages based upon the inaccuracy or untruth of such representations and warranties may be asserted after such representations and warranties shall be obligated to indemnify Parent Indemnitees for the entire amount of the Losses and Expenses from the first dollar; PROVIDED, FURTHER, that the aggregate maximum amount required to be paid by the Shareholders thus extinguished pursuant to this SECTION 9.1 hereunder Section 9.1.2 or Section 9.1.3; provided, however, that claims first asserted in writing within the applicable period (whether or not the amount of any such claim has become ascertainable within such period) shall not exceed thereafter be barred.
9.1.3 Notwithstanding the value foregoing provisions of Section 9.1.2, (i) the shares of Preferred Stock and the shares of Common Stock in payment of the Awards, determined in accordance with SECTION 9.4(c) (the "INDEMNIFICATION LIMIT"). The indemnification provided for in this SECTION 9.1 shall terminate fifteen (15) months after the Closing Date (and no claims shall be made by the Parent Indemnitees under this SECTION 9.1(b) thereafter), except that the indemnification by Shareholders shall continue as to:
(a) The representations and warranties set forth in SECTIONS 4.11 Sections 4.1, 4.2, 4.25, 4.27 and 4.28 shall survive forever, subject to applicable statutes of limitation, (title to assets), as to all of which no time limitation shall apply;
(bii) The the representations and warranties set forth made in SECTIONS 4.15 Section 4.6 shall in each case survive until the first anniversary of the later of (ERISA)A) the date on which the applicable period of limitation on assessment or refund of tax has expired, or (B) the date on which the applicable tax year (or portion thereof) has been closed, and 4.14 (Taxes), which iii) the representations and warranties made in Sections 4.19 and 4.20 shall survive for until the sixtieth day following the expiration of the applicable statute of limitations period under which a claim can be brought against Parent or the Company; andlimitations.
(c) Any Loss or Expense 9.1.4 Such indemnification obligation of which any Parent Indemnitee has notified the Shareholder shall be secured by the right, but not the obligation, of LKQ, in accordance with the requirements provisions set forth below, to set-off against (a) the Escrow Funds held by the Escrow Agent (provided that notice of SECTION 9.4 on or prior a potential claim for Damages is delivered by LKQ to the date such indemnification would otherwise terminate in accordance with this SECTION 9.1, as to which Shareholder during the obligation of Shareholder shall continue until first year after the liability of Shareholder shall have been determined pursuant to this ARTICLE IX, and Shareholder shall have reimbursed all Parent Indemnitees for the full amount of such Loss and Expense in accordance with this ARTICLE IX. To the extent any Parent Indemnitee is entitled to indemnification pursuant to this SECTION 9.1, Shareholder, their successors and assigns hereby forever waive, release and agree not to make any claim or bring any cost recovery action against the Parent Indemnitees, successors and assigns under any director or officer indemnity agreementClosing), or provision in law (b) amounts payable to the Shareholder or his affiliates under the Company's Certificate Leases (excluding the Salem Lease and provided that notice of incorporation or by-laws or under CERCLA or any other Environmental Law a potential claim for Damages is delivered by LKQ to the extent that such claim or cost recovery action relates Shareholder during the second year after the Closing). Upon notice to the same matter as constitutes Shareholder specifying in reasonable detail the basis for such Parent Indemnitees' set-off, LKQ and the Shareholder shall meet within twenty days thereafter (the “Meeting”) and attempt to resolve the dispute in good faith. If the dispute is unresolved at the Meeting, the dispute shall be settled by arbitration in accordance with the rules for commercial arbitration of the American Arbitration Association (or a similar organization) in effect at the time such arbitration is initiated. A list of arbitrators shall be reviewed by the Shareholder and LKQ from which one will be chosen using the applicable rules. The hearing shall be conducted as close as practicable to Portland, Oregon, unless both parties consent to a different location. The hearing shall occur within sixty days after the Meeting. The decision of the arbitrator shall be final and binding upon all parties. Except to the extent it is exercised, such right of set-off against the Escrow Funds or the amounts payable under the Leases shall not limit or otherwise affect the obligation of the Shareholder to satisfy any indemnification obligation under this Section 9.1 directly. Neither the exercise of nor the failure to exercise such right of set-off will constitute an election of remedies or limit LKQ in any manner in the enforcement of any other remedies that may be available to it. All interest earned on the Escrow Funds shall be added to and become a part of the Escrow Funds. The sole purpose of the Escrow Funds is to provide a source of funds to pay any amount that the arbitrator determines is owed to LKQ pursuant to Section 9.1 of this Agreement. Before asserting a claim against the Escrow Funds, LKQ must first assert a claim for indemnification under Section 9.1. of this Agreement. LKQ shall not present a disbursement request under the Escrow Agreement until its claim for indemnification under Section 9.1 of this Agreement is resolved and then any disbursement request shall be consistent with the arbitrator’s resolution of LKQ’s claim for indemnification. On the first anniversary of the Closing, the parties agree to deliver instructions to the Escrow Agent to disburse to the Shareholder all Escrow Funds that are not then subject to a pending claim of LKQ for indemnification under Section 9.1 of this Agreement.
Appears in 1 contract
Samples: Stock Purchase Agreement (LKQ Corp)
Indemnification by the Shareholder. The Shareholders agree Subject to the other provisions of this Article XII, the Shareholder shall indemnify and hold harmless ParentTridex, the Surviving Corporation Buyer, their Affiliates and their respective successors employees, representatives, officers, directors and assigns agents (the "PARENT INDEMNITEESBuyer Indemnitees") harmless from and against any and all Losses and Expenses incurred Damages suffered by such Parent Indemnitees in connection with or any Buyer Indemnitee arising fromout of:
(a) Any the breach by the Company of any representation or warranty made by any of its covenants the Selling Parties in this Agreement or in any Company Ancillary Document, or certificate delivered by any failure of the Company to perform any of its obligations in this Agreement or in any Company Ancillary Document; PROVIDED, HOWEVER, with respect to Selling Parties at the Company, this indemnification is limited to breaches of agreements and covenants to be performed by the Company on or prior to the Closing DateClosing;
(b) Any the breach of any warranty or the inaccuracy of covenant by any representation regarding the Company contained in ARTICLE IV or referred to in the Agreement or any certificate delivered by or on behalf of the Company pursuant hereto, except for the representations and warranties contained Selling Parties in Section 4.20this Agreement; andor
(c) the exercise of dissenters' rights by any shareholder of the Company; PROVIDED, HOWEVER, that the Shareholders shall be required to indemnify and hold harmless under clauses (a) and (b) of this Section with respect to Losses and Expenses incurred by the Parent Indemnitees, only if the aggregate amount of such Losses and Expenses exceeds $25,000 (the "THRESHOLD AMOUNT"), in which case the Shareholders shall be obligated to indemnify Parent Indemnitees for the entire amount of the Losses and Expenses from the first dollar; PROVIDED, FURTHER, that the aggregate maximum amount required to be paid by the Shareholders pursuant to this SECTION 9.1 hereunder shall not exceed the value of the shares of Preferred Stock and the shares of Common Stock in payment of the Awards, determined in accordance with SECTION 9.4(c) (the "INDEMNIFICATION LIMIT"). The indemnification provided for in this SECTION 9.1 shall terminate fifteen (15) months after the Closing Date (and Date, the failure by any of the Selling Parties to perform any of their respective obligations under this Agreement; provided, however, that no claims claim for indemnification under this Section 12.1 shall be made by the Parent Buyer Indemnitees unless and until the Buyer Indemnitees have incurred Damages in excess of One Hundred Thousand ($100,000) (the "Buyer Threshold Amount"). Once the Buyer Indemnitees have incurred Damages in excess of the Threshold Amount, the Buyer Indemnitees shall be entitled to indemnification for all Damages suffered by the Buyer Indemnitees. In no event shall the Shareholder's obligations for indemnification under this SECTION 9.1(bSection 12.1 exceed Five Million Dollars ($5,000,000) thereafterand in no event shall Shareholder's obligations for indemnification with respect to Section 6.27 exceed Seven Hundred Fifty Thousand Dollars ($750,000). Except for claims regarding a breach of Sections 6.3, except 6.8 and 6.27, the Buyer Indemnitees shall not be permitted to make claims after the first anniversary of the Closing Date, provided that the indemnification by Shareholders shall continue as to:
(a) The representations and warranties set forth any liability with respect to any claim, or notice of proposed claim, that is made in SECTIONS 4.11 (title to assets), as to all of which no time limitation shall apply;
(b) The representations and warranties set forth in SECTIONS 4.15 (ERISA), and 4.14 (Taxes), which shall survive for the applicable statute of limitations period under which a claim can be brought against Parent or the Company; and
(c) Any Loss or Expense of which any Parent Indemnitee has notified the Shareholder in accordance with the requirements of SECTION 9.4 on or writing prior to the date such indemnification would otherwise terminate in accordance with this SECTION 9.1, as to which first anniversary of the obligation of Shareholder Closing Date shall continue survive until the liability of Shareholder finally determined and paid. The Buyer Indemnitees shall have been determined pursuant to this ARTICLE IX, and Shareholder shall have reimbursed all Parent Indemnitees for the full amount of such Loss and Expense in accordance with this ARTICLE IX. To the extent any Parent Indemnitee is entitled to indemnification pursuant to this SECTION 9.1, Shareholder, their successors and assigns hereby forever waive, release and agree not be permitted to make claims regarding a breach of Sections 6.3 until, but not later than, the second anniversary of the Closing Date, provided that any claim or bring liability with respect to any cost recovery action against the Parent Indemnitees, successors and assigns under any director or officer indemnity agreementsuch claim, or provision notice of proposed claim, that is made in law or under the Company's Certificate of incorporation or by-laws or under CERCLA or any other Environmental Law writing prior to the extent second anniversary of the Closing Date shall survive until finally determined and paid. The Buyer Indemnitees shall be permitted to make claims regarding a breach of Section 6.8 or 6.27 until, but not later than, the third anniversary of the Closing Date, provided that any liability with respect to any such claim claim, or cost recovery action relates notice of proposed claim, that is made in writing prior to the same matter as constitutes third anniversary of the basis for such Parent Indemnitees' claim for indemnificationClosing Date shall survive until finally determined and paid.
Appears in 1 contract
Indemnification by the Shareholder. (1) Subject to Sections 6.01(1) and 7.01(2):
(a) The Shareholders agree to indemnify Shareholder shall indemnify, save and hold harmless Parentharmless, discharge and release the Surviving Corporation and their respective successors and assigns (the "PARENT INDEMNITEES") Purchaser from and against any and all Losses and Expenses incurred by such Parent Indemnitees in connection with Damages arising from or arising frombased on:
(ai) Any breach any inaccuracy in any representation or warranty made by the Company Shareholder in Article 3 or Article 4 of this Agreement;
(ii) any breach of any covenant of its covenants the Shareholder set forth in this Agreement or in Agreement;
(iii) any Company Ancillary Document, or liability arising from any Taxes it may be required to pay as a result of the failure of the Company Corporation to perform make the appropriate filings, registrations or payments in respect of Taxes (for greater certainty, including any Taxes relating or arising from the sale of its obligations in this Agreement or in any Company Ancillary Document; PROVIDEDthe Shares, HOWEVERSoftware, with respect and Intellectual Property to the Company, this indemnification is limited to breaches of agreements and covenants to be performed by the Company on or prior to the Closing Date;Purchaser); or
(biv) Any breach of any warranty or the inaccuracy of any representation regarding the Company contained in ARTICLE IV or referred to in the Agreement or any certificate delivered Claims made by or on behalf of Xxxxxxx X. Xxxxxx in respect of his rights and entitlements set out in the Company Xxxxxx Employment Agreement, including without limitation any payment(s) which may become due pursuant hereto, except for the representations and warranties contained in Section 4.20; andto paragraph 7(a) thereof or any other form of severance payments.
(c2) The following limitations will apply with regard to the exercise of dissenters' rights by any shareholder of Damages for which the Company; PROVIDED, HOWEVER, that the Shareholders shall be required to indemnify and hold harmless under clauses (a) and (b) of this Section with respect to Losses and Expenses incurred by the Parent Indemnitees, only if the aggregate amount of such Losses and Expenses exceeds $25,000 (the "THRESHOLD AMOUNT"), in which case the Shareholders shall be obligated to indemnify Parent Indemnitees for the entire amount of the Losses and Expenses from the first dollar; PROVIDED, FURTHER, that the aggregate maximum amount required to be paid by the Shareholders pursuant to this SECTION 9.1 hereunder shall not exceed the value of the shares of Preferred Stock and the shares of Common Stock in payment of the Awards, determined in accordance with SECTION 9.4(c) (the "INDEMNIFICATION LIMIT"). The Shareholder would otherwise have indemnification provided for in this SECTION 9.1 shall terminate fifteen (15) months after the Closing Date (and no claims shall be made by the Parent Indemnitees obligations under this SECTION 9.1(b) thereafter), except that the indemnification by Shareholders shall continue as toAgreement:
(a) The representations and warranties indemnities of the Shareholder set forth in SECTIONS 4.11 (title this Agreement shall not apply until the aggregate of all Damages suffered by the Purchaser, both hereunder and pursuant to assets)the IP Purchase Agreement, as total more than $20,000, in the aggregate, in which event the indemnities of the Shareholder under this Agreement shall apply to all Damages and not only those Damages which in the aggregate are in excess of which no time limitation shall apply;$20,000. For greater certainty, the parties hereby agree that the $20,000 threshold does not apply to the calculation of the Tangible Net Assets.
(b) The representations With respect to the indemnification by the Shareholder under this Section 7.01, including a Claim under the IP Purchase Agreement, the maximum aggregate liability of the Shareholder shall not exceed the aggregate amount of the Share Purchase Price and warranties set forth in SECTIONS 4.15 (ERISA), and 4.14 (Taxes), which shall survive for the applicable statute of limitations period Purchase Price under which a claim can be brought against Parent or the Company; andIP Purchase Agreement.
(c) Any Loss or Expense of which any Parent Indemnitee has notified Claim made against the Shareholder in accordance hereunder or pursuant to the IP Purchase Agreement, to which the Purchaser hereunder or under the IP Purchase Agreement is entitled to indemnity from the Shareholder, shall first be satisfied from any amounts of Share Purchase Price which are at that time due and payableto the Shareholder pursuant to the terms of this Agreement.
(d) For the avoidance of doubt, the prosecution of a Claim by Purchaser under this Agreement shall preclude Purchaser from pursuing a Claim with the requirements same basis under the IP Purchase Agreement, and the prosecution of SECTION 9.4 on a Claim by Purchaser under this Agreement shall preclude Purchaser from pursuing a Claim with the same basis under the IP Purchase Agreement.
(3) Notwithstanding the foregoing, the limitations in this Section 7.01(2) do not apply to Section 7.01(1)(iv), or where there has been fraud or wilful misrepresentation by the Shareholder.
(4) The Purchaser may only bring an indemnity claim under Section 7.01(1) if the Purchaser brings such claim prior to the date expiry of the relevant survival period in Section 6.01(1) related to such indemnification would otherwise terminate in accordance with this SECTION 9.1, as to which the obligation of Shareholder shall continue until the liability of Shareholder shall have been determined pursuant to this ARTICLE IX, and Shareholder shall have reimbursed all Parent Indemnitees for the full amount of such Loss and Expense in accordance with this ARTICLE IX. To the extent any Parent Indemnitee is entitled to indemnification pursuant to this SECTION 9.1, Shareholder, their successors and assigns hereby forever waive, release and agree not to make any claim or bring any cost recovery action against the Parent Indemnitees, successors and assigns under any director or officer indemnity agreement, or provision in law or under the Company's Certificate of incorporation or by-laws or under CERCLA or any other Environmental Law to the extent that such claim or cost recovery action relates to the same matter as constitutes the basis for such Parent Indemnitees' claim for indemnificationClaim.
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