Indemnification Claim Procedure. If any Indemnitee has or reasonably believes it has incurred or suffered, or reasonably believes that it is reasonably likely to incur or suffer, Damages for which it is or will be entitled to be held harmless, indemnified, compensated or reimbursed under Section 9 or for which it is or will be entitled to a monetary remedy (such as in the case of a claim based on Fraudulent breach of a representation or warranty herein by or on behalf of the Company), such Indemnitee may deliver a notice of claim (a “Notice of Claim”) to the Securityholders’ Agent. Each Notice of Claim shall state the basis for such claim and each Indemnitee shall make available to the Securityholders’ Agent any documents and materials in such Indemnitee’s possession or control supporting the claims set forth in the Notice of Claim. In the event the Securityholders’ Agent does not notify the Indemnitee within thirty (30) days following its receipt of a Notice of Claim that the Securityholders’ Agent (on behalf of the Effective Time Holders) disputes the liability of the Effective Time Holders to the Indemnitee under this Section 9 or the amount thereof, the claim specified in such Notice of Claim shall be conclusively deemed a liability of the Effective Time Holders under this Section 9, and Parent may claim from the Escrow Amount or, to the extent the remaining funds in the Escrow Amount are insufficient to cover the amount of such claim and such claim is not subject to the limitations set forth in Section 9.3(c) in accordance with Section 9.3(d), the Effective Time Holders shall pay the amount of such liability to the Indemnitee on demand or, in the case of any notice in which the amount of the claim (or any portion of the claim) is estimated, on such later date when the amount of such claim (or such portion of such claim) becomes finally determined. In the event the Securityholders’ Agent has timely disputed the liability of the Effective Time Holders (a “Claim Objection”) with respect to such claim as provided above, as promptly as possible, such Indemnitee and the Securityholders’ Agent shall establish the merits and amount of such claim (by mutual agreement, litigation, arbitration or otherwise) and if an agreement is reached, a memorandum setting forth such agreement shall be prepared and signed by both parties and shall be furnished to the Escrow Agent. If such Indemnitee and the Securityholders’ Agent do not reach an agreement as to the merits and amount of such claim within thirty (30) days immediately after the date such Claim Objection is delivered to Parent, either Parent or the Company (or the Securityholders’ Agent after the Effective Time) may demand arbitration of the matter unless the amount of the damage or loss is at issue in pending litigation or arbitration with a third party, in which event arbitration shall not be commenced until such amount is ascertained or both parties agree to arbitration. Any arbitration requested pursuant to this Section 9.6 shall be settled by arbitration conducted by three (3) arbitrators. Parent and the Company (or the Securityholders’ Agent after the Effective Time) shall each select one (1) arbitrator, and the two (2) arbitrators so selected shall select a third arbitrator. The arbitrator shall, within ten (10) Business Days after the last day of any hearings on any motion, issue a definitive ruling on such motion. The arbitrator shall also, within twenty (20) Business Days from the last day of any hearings regarding the imposition of sanctions or the issuance of any awards, issue a definitive ruling on the imposition of any such sanctions or the issuance of any such award in such arbitration. The arbitrator shall also establish procedures designed to reduce the cost and time for discovery, while allowing the parties a reasonable opportunity, adequate in the sole judgment of the arbitrator, to discover relevant information from the opposing parties about the subject matter of the dispute. The arbitrator shall rule upon motions to compel or limit discovery and shall have the authority to impose sanctions, including attorneys’ fees and costs, to the same extent as a court of competent law or equity, should the arbitrator determine that discovery was sought without substantial justification or that discovery was refused or objected to without substantial justification. The decision of the arbitrator, or a majority of the three (3) arbitrators, as applicable, shall be binding and conclusive upon the parties to this Agreement, and the Escrow Agent shall be entitled to act in accordance with such decision and make or withhold payments out of the Escrow Fund in accordance therewith. Such decision shall be written and shall be supported by written findings of fact and conclusions, which shall set forth the award, judgment, decree or order awarded by the arbitrator. Judgment upon any award rendered by the arbitrator may be entered in any court having jurisdiction. Any such arbitration shall be held in Wilmington, Delaware, under the rules then in effect of the American Arbitration Association.
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Samples: Merger Agreement (Under Armour, Inc.), Merger Agreement (Under Armour, Inc.)
Indemnification Claim Procedure. (a) If any Indemnitee has or reasonably believes it has claims in good faith to have incurred or suffered, or reasonably believes in good faith that it is reasonably likely to may incur or suffer, Damages for which it is or will may be entitled to be held harmless, indemnified, compensated or reimbursed under Section 9 this ARTICLE 6 or for which it is or will may be entitled to a monetary remedy (such as in the case of a claim based on Fraudulent breach of a representation fraud or warranty herein by or on behalf of the Companyintentional misrepresentation), such Indemnitee may deliver a notice of claim (a “Notice of Claim”) to the Securityholders’ AgentSeller. Each Notice of Claim shall shall: (i) state that such Indemnitee believes in good faith that such Indemnitee is or may be entitled to indemnification, compensation or reimbursement under this ARTICLE 6 or is or may otherwise be entitled to a monetary remedy; (ii) contain a brief description of the basis for such claim facts and each Indemnitee shall make available to circumstances supporting the Securityholders’ Agent any documents and materials in such Indemnitee’s possession or control supporting claim; and (iii) contain a good faith, non-binding, preliminary estimate of the claims set forth in aggregate amount of the Notice of Claim. In the event the Securityholders’ Agent does not notify actual and potential Damages that the Indemnitee within thirty believes have arisen and may arise as a result of such facts and circumstances (30the aggregate amount of such estimate, as it may be modified by such Indemnitee in good faith from time to time, being referred to as the “Claimed Amount”).
(b) days following its receipt During the twenty (20)-day period commencing upon delivery by an Indemnitee to Seller of a Notice of Claim that (the Securityholders’ Agent (on behalf of the Effective Time Holders) disputes the liability of the Effective Time Holders “Dispute Period”), Seller may deliver to the Indemnitee under this Section 9 or who delivered the amount thereof, the claim specified in such Notice of Claim and, to the extent funds remain in the Escrow Account, to the Escrow Agent a written response (the “Response Notice”) in which Seller: (i) agrees that the full Claimed Amount is owed to the Indemnitee; (ii) agrees that part, but not all, of the Claimed Amount (such agreed portion, the “Agreed Amount”) is owed to the Indemnitee; or (iii) indicates that no part of the Claimed Amount is owed to the Indemnitee. If the Response Notice is delivered in accordance with clause (ii) or (iii) of the preceding sentence, the Response Notice shall also contain a brief description of the facts and circumstances supporting Seller’s claim that only a portion or no part of the Claimed Amount is owed to the Indemnitee, as the case may be. Any part of the Claimed Amount that is not agreed to be owed to the Indemnitee pursuant to the Response Notice (or the entire Claimed Amount, if Seller asserts in the Response Notice that no part of the Claimed Amount is owed to the Indemnitee) is referred to in this Agreement as the “Contested Amount” (it being understood that the Contested Amount shall be modified from time to time to reflect any good faith modifications by the Indemnitee to the Claimed Amount). If no Response Notice is delivered prior to the expiration of the Dispute Period, then Seller shall be conclusively deemed a liability of to have agreed that the Effective Time Holders under this Section 9, and Parent may claim from the Escrow full Claimed Amount or, is owed to the extent Indemnitee.
(c) If: (i) Seller delivers a Response Notice agreeing that the remaining funds in the Escrow full Claimed Amount are insufficient to cover the amount of such claim and such claim is not subject owed to the limitations set forth in Section 9.3(cIndemnitee; or (ii) in accordance with Section 9.3(d)Seller does not deliver a Response Notice during the Dispute Period, the Effective Time Holders shall pay the amount of such liability to the Indemnitee on demand orthen, in the case of any notice in which the amount of the claim (or any portion of the claim) is estimated, on such later date when the amount of such claim (or such portion of such claim) becomes finally determined. In the event the Securityholders’ Agent has timely disputed the liability of the Effective Time Holders (a “Claim Objection”) with respect to such claim as provided above, as promptly as possible, such Indemnitee and the Securityholders’ Agent shall establish the merits and amount of such claim (by mutual agreement, litigation, arbitration or otherwise) and if an agreement is reached, a memorandum setting forth such agreement shall be prepared and signed by both parties and shall be furnished to the Escrow Agent. If such Indemnitee and the Securityholders’ Agent do not reach an agreement as to the merits and amount of such claim within thirty (30) days immediately after the date such Claim Objection is delivered to Parent, either Parent or the Company (or the Securityholders’ Agent after the Effective Time) may demand arbitration of the matter unless the amount of the damage or loss is at issue in pending litigation or arbitration with a third party, in which event arbitration shall not be commenced until such amount is ascertained or both parties agree to arbitration. Any arbitration requested pursuant to this Section 9.6 shall be settled by arbitration conducted by three (3) arbitrators. Parent and Business Days following the Company receipt of such Response Notice by the Indemnitee or within three (or the Securityholders’ Agent after the Effective Time) shall each select one (1) arbitrator, and the two (2) arbitrators so selected shall select a third arbitrator. The arbitrator shall, within ten (103) Business Days after the last day of any hearings on any motion, issue a definitive ruling on such motion. The arbitrator shall also, within twenty (20) Business Days from the last day of any hearings regarding the imposition of sanctions or the issuance of any awards, issue a definitive ruling on the imposition of any such sanctions or the issuance of any such award in such arbitration. The arbitrator shall also establish procedures designed to reduce the cost and time for discovery, while allowing the parties a reasonable opportunity, adequate in the sole judgment expiration of the arbitratorDispute Period, to discover relevant information from as the opposing parties about case may be, Seller and the subject matter Stockholders, jointly and severally, shall pay the Indemnitee an amount of the dispute. The arbitrator shall rule upon motions to compel or limit discovery and shall have the authority to impose sanctions, including attorneys’ fees and costs, cash equal to the same extent as full Claimed Amount.
(d) If Seller delivers a court of competent law or equityResponse Notice during the Dispute Period agreeing that less than the full Claimed Amount is owed to the Indemnitee, should the arbitrator determine that discovery was sought without substantial justification or that discovery was refused or objected to without substantial justification. The decision of the arbitrator, or a majority of the then within three (3) arbitratorsBusiness Days following the receipt of such Response Notice, as applicableSeller and the Stockholders, jointly and severally, shall pay the Indemnitee an amount of cash equal to the Agreed Amount.
(e) If Seller delivers a Response Notice during the Dispute Period indicating that there is a Contested Amount, Seller and the Indemnitee shall attempt in good faith to resolve the dispute related to the Contested Amount. If the Indemnitee and Seller resolve such dispute, a settlement agreement stipulating the amount owed to the Indemnitee (the “Stipulated Amount”) shall be binding signed by the Indemnitee and conclusive upon Seller. Within three (3) Business Days following the parties execution of such settlement agreement (or such shorter period of time as may be set forth in the settlement agreement), Seller and the Stockholders, jointly and severally, shall pay the Indemnitee an amount of cash equal to the Stipulated Amount.
(f) In the event that there is a dispute relating to any Notice of Claim or any Contested Amount (whether it is a matter between any Indemnitee, on the one hand, and Seller, on the other hand, or it is a matter that is subject to a Third Party Claim brought against any Indemnitee), that remains unresolved after application of the terms of this Section 6.6, such dispute shall be settled in accordance with Section 9.8 hereof.
(g) To the extent that the amounts owed pursuant to this AgreementSection 6.6 are less than or equal to the value of the Parent Shares then held by the indemnifying party hereunder, and (i) such indemnifying party, in lieu of the Escrow Agent cash payment(s) described above, shall be entitled to act in accordance transfer to the applicable Indemnitee a number of Parent Shares with a value equal to such decision cash payment and make (ii) at Buyer’s (or withhold payments out any successor thereto or assign thereof) sole option, Parent shall transfer from the applicable indemnifying party to the applicable Indemnitee a number of the Escrow Fund in accordance therewithParent Shares with a value equal to such cash payment. Such decision shall Transfers made hereunder will be written and shall be supported made by written findings of fact and conclusions, which shall set forth the award, judgment, decree or order awarded by the arbitrator. Judgment upon any award rendered by the arbitrator may be entered in any court having jurisdiction. Any Parent causing its transfer agent to open a book-entry position evidencing such arbitration shall be held in Wilmington, Delaware, under the rules then in effect of the American Arbitration Associationtransfer.
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Indemnification Claim Procedure. (a) If any Indemnitee has or reasonably believes it has claims in good faith to have incurred or suffered, or reasonably believes in good faith that it is reasonably likely to may incur or suffer, Damages for which it is or will may be entitled to be held harmless, indemnified, compensated or reimbursed under Section 9 this Article 8 or for which it is or will may be entitled to a monetary remedy (such as in the case of a claim based on Fraudulent breach of a representation fraud or warranty herein by or on behalf of the Companyintentional misrepresentation), such Indemnitee may deliver a notice of claim (a “Notice of Claim”) to the Securityholders’ applicable Indemnitor (and, in the case the Notice of Claim is delivered by a Buyer Indemnitee, to the Escrow Agent, to the extent funds remain in the Escrow Account). Each Notice of Claim shall shall: (i) state that such Indemnitee believes in good faith that such Indemnitee is or may be entitled to indemnification, compensation or reimbursement under this Article 8 or is or may otherwise be entitled to a monetary remedy; (ii) contain a brief description of the basis for facts and circumstances supporting the Indemnitee’s claim; and (iii) contain a good faith, non-binding, preliminary estimate of the aggregate amount of the actual and potential Damages that the Indemnitee believes have arisen and may arise as a result of such claim facts and each circumstances (the aggregate amount of such estimate, as it may be modified by such Indemnitee shall make available in good faith from time to time, being referred to as the “Claimed Amount”).
(b) During the twenty (20)-day period commencing upon delivery by an Indemnitee to the Securityholders’ Agent any documents and materials in such Indemnitee’s possession or control supporting the claims set forth in the Notice of Claim. In the event the Securityholders’ Agent does not notify the Indemnitee within thirty (30) days following its receipt applicable Indemnitor of a Notice of Claim that (the Securityholders’ Agent (on behalf of “Claim Dispute Period”), the Effective Time Holders) disputes the liability of the Effective Time Holders applicable Indemnitor may deliver to the Indemnitee under this Section 9 or who delivered the amount thereof, the claim specified in such Notice of Claim (and, in the case the Notice of Claim was delivered by a Buyer Indemnitee, to the Escrow Agent, to the extent funds remain in the Escrow Account) a written response (the “Response Notice”) in which the Indemnitor: (i) agrees that the full Claimed Amount is owed to the Indemnitee; (ii) agrees that part, but not all, of the Claimed Amount (such agreed portion, the “Agreed Amount”) is owed to the Indemnitee; or (iii) indicates that no part of the Claimed Amount is owed to the Indemnitee. If the Notice of Claim relates to a Third Party Claim, the Response Notice shall also specify whether or not the Indemnitor desires to assume control of the defense of such Third Party Claim. If the Response Notice is delivered in accordance with clause (ii) or (iii) of the preceding sentence, the Response Notice shall also contain a brief description of the facts and circumstances supporting the Indemnitor’s claim that only a portion or no part of the Claimed Amount is owed to the Indemnitee, as the case may be. Any part of the Claimed Amount that is not agreed to be owed to the Indemnitee pursuant to the Response Notice (or the entire Claimed Amount, if the Indemnitor asserts in the Response Notice that no part of the Claimed Amount is owed to the Indemnitee) is referred to in this Agreement as the ” Contested Amount” (it being understood that the Contested Amount shall be modified from time to time to reflect any good faith modifications by the Indemnitee to the Claimed Amount). If no Response Notice is delivered prior to the expiration of the Claim Dispute Period, then the Indemnitor shall be conclusively deemed to have agreed that the full Claimed Amount is owed to the Indemnitee.
(c) If: (i) the Indemnitor delivers a liability Response Notice agreeing that the full Claimed Amount is owed to the Indemnitee; or (ii) the Indemnitor does not deliver a Response Notice during the Claim Dispute Period, then, within three (3) Business Days following the receipt of such Response Notice by the Indemnitee (or, in the case the Notice of Claim was delivered by a Buyer Indemnitee, by the Escrow Agent) or within three (3) Business Days after the expiration of the Effective Time Holders under this Section 9Claim Dispute Period, as the case may be, the Indemnitor shall pay to the applicable Indemnitee an amount in cash equal to the full Claimed Amount (or, in the case the Notice of Claim was delivered by a Buyer Indemnitee and Parent may claim funds remain in the Escrow Account, the Escrow Agent shall release to the applicable Buyer Indemnitee from the Escrow Account an amount in cash equal to the full Claimed Amount or(or such lesser amount as may remain in the Escrow Account)); provided, however, that, in the case the Notice of Claim was delivered by a Buyer Indemnitee and to the extent the funds in the Escrow Account are insufficient to cover the Claimed Amount, Seller shall promptly pay to the applicable Buyer Indemnitee the amount by which the Claimed Amount exceeds the remaining funds in the Escrow Account.
(d) If the Indemnitor delivers a Response Notice during the Claim Dispute Period agreeing that less than the full Claimed Amount is owed to the Indemnitee, then within three (3) Business Days following the receipt of such Response Notice, the Indemnitor shall pay to the applicable Indemnitee an amount in cash equal to the Agreed Amount (or, in the case the Notice of Claim was delivered by a Buyer Indemnitee and funds remain in the Escrow Account, the Escrow Agent shall release to the applicable Buyer Indemnitee from the Escrow Account an amount in cash equal to the Agreed Amount (or such lesser amount as may remain in the Escrow Account)); provided, however, that, in the case the Notice of Claim was delivered by a Buyer Indemnitee and to the extent the funds in the Escrow Account are insufficient to cover the Agreed Amount, Seller shall promptly pay to the applicable Buyer Indemnitee the amount by which the Agreed Amount exceeds the remaining funds in the Escrow Account.
(a) If the Indemnitor delivers a Response Notice during the Claim Dispute Period indicating that there is a Contested Amount, the Indemnitor and the Indemnitee shall attempt in good faith to resolve the dispute related to the Contested Amount. If the Indemnitee and the Indemnitor resolve such dispute, a settlement agreement stipulating the amount owed to the Indemnitee (the “Stipulated Amount”) shall be signed by the Indemnitee and the Indemnitor. Within three (3) Business Days following the execution of such claim and settlement agreement (or such claim is not subject to the limitations shorter period of time as may be set forth in Section 9.3(c) in accordance with Section 9.3(dthe settlement agreement), the Effective Time Holders Indemnitor shall pay the amount of such liability to the applicable Indemnitee on demand an amount in cash equal to the Stipulated Amount (or, in the case the Notice of any notice Claim was delivered by a Buyer Indemnitee and funds remain in which the Escrow Account, Seller and Buyer shall deliver joint written instructions to the Escrow Agent instructing the Escrow Agent to release to the applicable Buyer Indemnitee from the Escrow Account an amount of in cash equal to the claim (or any portion of the claim) is estimated, on such later date when the amount of such claim Stipulated Amount (or such portion lesser amount as may remain in the Escrow Account)); provided, however, that, in the case the Notice of such claimClaim was delivered by a Buyer Indemnitee and to the extent the funds in the Escrow Account are insufficient to cover the Stipulated Amount, Seller shall promptly pay to the applicable Buyer Indemnitee the amount by which the Stipulated Amount exceeds the remaining funds in the Escrow Account.
(b) becomes finally determined. In the event that there is a dispute relating to any Notice of Claim or any Contested Amount (whether it is a matter between any Indemnitee, on the Securityholders’ Agent has timely disputed one hand, and the liability applicable Indemnitor, on the other hand, or it is a matter that is subject to a Third Party Claim brought against any Indemnitee), that remains unresolved after application of the Effective Time Holders (a “Claim Objection”) with respect to such claim as provided above, as promptly as possibleterms of this Section 8.6, such Indemnitee and the Securityholders’ Agent shall establish the merits and amount of such claim (by mutual agreement, litigation, arbitration or otherwise) and if an agreement is reached, a memorandum setting forth such agreement shall be prepared and signed by both parties and shall be furnished to the Escrow Agent. If such Indemnitee and the Securityholders’ Agent do not reach an agreement as to the merits and amount of such claim within thirty (30) days immediately after the date such Claim Objection is delivered to Parent, either Parent or the Company (or the Securityholders’ Agent after the Effective Time) may demand arbitration of the matter unless the amount of the damage or loss is at issue in pending litigation or arbitration with a third party, in which event arbitration shall not be commenced until such amount is ascertained or both parties agree to arbitration. Any arbitration requested pursuant to this Section 9.6 dispute shall be settled by arbitration conducted by three (3) arbitrators. Parent and the Company (or the Securityholders’ Agent after the Effective Time) shall each select one (1) arbitrator, and the two (2) arbitrators so selected shall select a third arbitrator. The arbitrator shall, within ten (10) Business Days after the last day of any hearings on any motion, issue a definitive ruling on such motion. The arbitrator shall also, within twenty (20) Business Days from the last day of any hearings regarding the imposition of sanctions or the issuance of any awards, issue a definitive ruling on the imposition of any such sanctions or the issuance of any such award in such arbitration. The arbitrator shall also establish procedures designed to reduce the cost and time for discovery, while allowing the parties a reasonable opportunity, adequate in the sole judgment of the arbitrator, to discover relevant information from the opposing parties about the subject matter of the dispute. The arbitrator shall rule upon motions to compel or limit discovery and shall have the authority to impose sanctions, including attorneys’ fees and costs, to the same extent as a court of competent law or equity, should the arbitrator determine that discovery was sought without substantial justification or that discovery was refused or objected to without substantial justification. The decision of the arbitrator, or a majority of the three (3) arbitrators, as applicable, shall be binding and conclusive upon the parties to this Agreement, and the Escrow Agent shall be entitled to act in accordance with such decision and make or withhold payments out of the Escrow Fund in accordance therewith. Such decision shall be written and shall be supported by written findings of fact and conclusions, which shall set forth the award, judgment, decree or order awarded by the arbitrator. Judgment upon any award rendered by the arbitrator may be entered in any court having jurisdiction. Any such arbitration shall be held in Wilmington, Delaware, under the rules then in effect of the American Arbitration AssociationSection 11.8.
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Indemnification Claim Procedure. (a) If any Indemnitee has or reasonably believes it has claims in good faith to have incurred or suffered, or reasonably believes in good faith that it is reasonably likely to may incur or suffer, Damages for which it is or will may be entitled to be held harmless, indemnified, compensated or reimbursed under Section 9 Article X or for which it is or will may be entitled to a monetary remedy (such as in the case of a claim based on Fraudulent breach of a representation or warranty herein by or on behalf of the Companyfraud), such Indemnitee may deliver a notice of claim (a “Notice of Claim”) to the SecurityholdersStockholders’ Agent; provided, however, that the failure timely to give a Notice of Claim shall affect the rights of an Indemnitee hereunder only to the extent that such failure has a materially prejudicial effect on the defenses or other rights available to the Indemnitee. Each Notice of Claim shall shall: (i) state that such Indemnitee believes in good faith that such Indemnitee is or may be entitled to indemnification, compensation or reimbursement under Article X or is or may otherwise be entitled to a monetary remedy; (ii) contain a brief description of the basis for facts and circumstances supporting the Indemnitee’s claim; and (iii) if practicable, contain a good faith, non-binding, preliminary estimate of the aggregate amount of the actual and potential Damages that the Indemnitee believes have arisen and may arise as a result of such claim facts and each circumstances (the aggregate amount of such estimate, as it may be modified by such Indemnitee shall make available in good faith from time to time, being referred to as the “Claimed Amount”).
(b) During the 30-day period commencing upon delivery by an Indemnitee to the SecurityholdersStockholders’ Agent any documents and materials in such Indemnitee’s possession or control supporting the claims set forth in the Notice of Claim. In the event the Securityholders’ Agent does not notify the Indemnitee within thirty (30) days following its receipt of a Notice of Claim that (the Securityholders“Dispute Period”), the Stockholders’ Agent (on behalf of the Effective Time Holders) disputes the liability of the Effective Time Holders may deliver to the Indemnitee under this Section 9 or who delivered the amount thereof, the claim specified in such Notice of Claim a written response (the “Response Notice”) in which the Stockholders’ Agent: (i) agrees that the full Claimed Amount is owed to the Indemnitee; (ii) agrees that part, but not all, of the Claimed Amount (the “Agreed Amount”) is owed to the Indemnitee; or (iii) indicates that no part of the Claimed Amount is owed to the Indemnitee. If the Response Notice is delivered in accordance with clause (ii) or (iii) of the preceding sentence, the Response Notice shall also contain a brief description of the facts and circumstances supporting the Stockholders’ Agent’s claim that only a portion or no part of the Claimed Amount is owed to the Indemnitee, as the case may be. Any part of the Claimed Amount that is not agreed to be owed to the Indemnitee pursuant to the Response Notice (or the entire Claimed Amount, if the Stockholders’ Agent asserts in the Response Notice that no part of the Claimed Amount is owed to the Indemnitee) is referred to in this Agreement as the “Contested Amount” (it being understood that the Contested Amount shall be modified from time to time to reflect any good faith modifications by the Indemnitee to the Claimed Amount). If a Response Notice is not received by the Indemnitee prior to the expiration of the Dispute Period, then the Stockholders’ Agent shall be conclusively deemed a liability of to have agreed that the Effective Time Holders under this Section 9, and Parent may claim from the Escrow full Claimed Amount or, is owed to the extent the remaining funds in the Escrow Amount are insufficient to cover the amount of such claim and such claim is not subject to the limitations set forth in Section 9.3(cIndemnitee.
(c) in accordance with Section 9.3(d), the Effective Time Holders shall pay the amount of such liability to the Indemnitee on demand or, in the case of any notice in which the amount of the claim (or any portion of the claim) is estimated, on such later date when the amount of such claim (or such portion of such claim) becomes finally determined. In the event the SecurityholdersWarranty Insurance is not bound at the Closing, if: (i) the Stockholders’ Agent has timely disputed delivers a Response Notice to the liability Indemnitee agreeing that the full Claimed Amount is owed to the Indemnitee; or (ii) the Stockholders’ Agent does not deliver a Response Notice to the Indemnitee during the Dispute Period, then the Parent and Stockholders’ Agent shall instruct the Escrow Agent to pay the Claimed Amount to the Indemnitee within three (3) Business Days.
(d) In the event the Warranty Insurance is not bound at the Closing if the Stockholders’ Agent delivers a Response Notice to the Indemnitee during the Dispute Period agreeing that less than the full Claimed Amount is owed to the Indemnitee, then the Parent and the Stockholders’ Agent shall instruct the Escrow Agent to pay such lesser amount to the Indemnitee within three (3) Business Days.
(e) In the event the Warranty Insurance is not bound at the Closing, if the Stockholders’ Agent delivers a Response Notice to the Indemnitee during the Dispute Period indicating that there is a Contested Amount, the Stockholders’ Agent and the Indemnitee shall attempt in good faith to resolve the dispute related to the Contested Amount. If the Indemnitee and the Stockholders’ Agent resolve-such dispute, then their resolution of such dispute shall be binding on the Effective Time Holders (a “Claim Objection”) with respect to such claim as provided aboveStockholders’ Agent, as promptly as possible, the Indemnifying Parties and such Indemnitee and a settlement agreement stipulating the Securityholdersamount owed to the Indemnitee (the “Stipulated Amount”) shall be signed by the Indemnitee and the Stockholders’ Agent. The Parent and Stockholders’ Agent shall establish instruct the merits and amount Escrow Agent to pay, within three (3) Business Days following the execution of such claim settlement agreement (by mutual or such shorter period of time as may be set forth in the settlement agreement, litigation, arbitration or otherwise) and if an agreement is reached, a memorandum setting forth such agreement shall be prepared and signed by both parties and shall be furnished the Stipulated Amount to the Escrow Agent. If such Indemnitee Indemnitee.
(f) In the event the Warranty Insurance is not bound at the Closing and in the event that there is a dispute relating to any Notice of Claim or Contested Amount (whether it is a matter between the Indemnitee, on the one hand, and the SecurityholdersStockholders’ Agent do not reach an agreement as Agent, on the other hand, or it is a matter that is subject to a claim or Legal Proceeding asserted or commenced by a third party brought against the merits and amount of such claim within thirty (30) days immediately after the date such Claim Objection is delivered to Parent, either Parent Indemnitee or the Company Company), such dispute (or the Securityholders’ Agent after the Effective Timean “Arbitrable Dispute”) may demand arbitration of the matter unless the amount of the damage or loss is at issue in pending litigation or arbitration with a third party, in which event arbitration shall not be commenced until such amount is ascertained or both parties agree to arbitration. Any arbitration requested pursuant to this Section 9.6 shall be settled by binding arbitration. Notwithstanding the preceding sentence, nothing in this Section 10.6 shall prevent the Indemnitee from seeking preliminary injunctive relief from a court of competent jurisdiction pending settlement of any Arbitrable Dispute. Any Arbitrable Dispute shall be resolved by arbitration conducted in Santa Xxxxx County, California in accordance with JAMS’ Comprehensive Arbitration Rules and Procedures (the “JAMS Rules”) then in effect. However, in all events, the provisions contained herein shall govern over any conflicting rules which may now or hereafter be contained in the JAMS Rules. Any judgment upon the award rendered by three (3) arbitrators. Parent and the Company (or arbitrator shall be entered in any court having jurisdiction over the Securityholders’ Agent after the Effective Time) shall each select one (1) arbitrator, and the two (2) arbitrators so selected shall select a third arbitratorsubject matter thereof. The arbitrator shall, within ten (10) Business Days after the last day of any hearings on any motion, issue a definitive ruling on such motion. The arbitrator shall also, within twenty (20) Business Days from the last day of any hearings regarding the imposition of sanctions or the issuance of any awards, issue a definitive ruling on the imposition of any such sanctions or the issuance of any such award in such arbitration. The arbitrator shall also establish procedures designed to reduce the cost and time for discovery, while allowing the parties a reasonable opportunity, adequate in the sole judgment of the arbitrator, to discover relevant information from the opposing parties about the subject matter of the dispute. The arbitrator shall rule upon motions to compel or limit discovery and shall have the authority to impose sanctionsgrant any equitable and legal remedies that would be available if any judicial proceeding was instituted to resolve an Arbitrable Dispute, including the ability to award attorneys’ fees and costs, to the same extent as a court of competent law or equity, should the arbitrator determine that discovery was sought without substantial justification or that discovery was refused or objected to without substantial justificationfees. The final decision of the arbitrator, or as entered by a majority court of the three (3) arbitratorscompetent jurisdiction, as applicable, shall will be binding and conclusive upon the parties to this Agreement, and the Escrow Agent shall be entitled to act in accordance with such decision and make or withhold payments out of the Escrow Fund in accordance therewith. Such decision shall be written and shall be supported by written findings of fact and conclusions, which shall set forth the award, judgment, decree or order awarded by the arbitrator. Judgment upon any award rendered furnished by the arbitrator to the Stockholders’ Agent and the Indemnitee in writing and will constitute a final, conclusive and non-appealable determination of the issue in question, binding upon the Stockholders’ Agent, the Indemnifying Parties and the Indemnitee, and an order with respect thereto may be entered in any court having of competent jurisdiction. Any Except as provided for in the following sentence, any such arbitration shall be held kept confidential by the Indemnitee, the Stockholders’ Agent and the Indemnifying Parties. To the extent that the arbitrator determines that the Indemnitee is entitled to receive any amount in Wilmingtonindemnification under this Article X for which it has not received anything pursuant to Section 10.6(d), Delawarethen the Parent shall provide such arbitration award to the Escrow Agent and instruct the Escrow Agent to pay such amount within three (3) Business Days.
(g) Notwithstanding anything contained in this Article X, under in the rules then event of any release from the Escrow Fund to Indemnitees, each Indemnifying Party shall be given a reasonable opportunity to provide the Escrow Agent with cash to be released by the Escrow Agent to the Indemnitees in effect lieu of a number of such Indemnifying Party’s shares of Parent Common Stock equal to the amount of such cash divided by the Parent Common Valuation, which shares may be allocated as designated in a writing delivered by such Indemnifying Party (or the Stockholders’ Agent) to the Escrow Agent among the classes and series of such stockholder’s Parent Common Stock that would otherwise have been released to the Indemnitees (such substitution of cash for shares, an “Escrowed Merger Consideration Reallocation”). Upon any such payment in cash by an Indemnifying Party, the corresponding shares of Parent Common Stock that would otherwise have been released to Indemnitee shall, instead, be promptly released from the Escrow Fund to such Indemnitee. Following any Escrowed Merger Consideration Reallocation by an Indemnifying Party, the relative proportions of each class and series of Parent Common Stock, and the cash, if any, of such Indemnifying Party that are released from the Escrow Fund thereafter if any, on account of such Indemnifying Party (whether the release is made to such Indemnifying Party, or to the Indemnitees) the relative proportions of each class and series of Parent Common Stock and cash, if any, to be released shall be those that existed following such Escrowed Merger Consideration Reallocation, rather than those existing in such Indemnifying Party’s Pro Rata Share of the American Arbitration AssociationEscrow Fund.
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Indemnification Claim Procedure. (a) If any Indemnitee has or reasonably believes it has incurred or suffered, or reasonably believes in good faith that it is reasonably likely will (pursuant to a Third Party Claim asserted or commenced before the applicable Survival Date) incur or suffer, Damages for which it is or will be entitled to be held harmlessharmless and indemnified under this Section 6, indemnified, compensated or reimbursed under Section 9 or for which it is or will be entitled to a another monetary remedy (such as in the case of a claim based on Fraudulent breach of a representation or warranty herein by or on behalf of Fraud, the Company), such Indemnitee may shall deliver a notice of claim (a “Notice of Claim”) promptly, and in any case within 30 days’ of the Indemnitee becoming aware of such claim, to the Securityholders’ Agentapplicable Indemnifying Party. Each Notice of Claim shall shall: (i) state that such Indemnitee believes in good faith that such Indemnitee is or will be entitled to indemnification under this Section 6 or is or will otherwise be entitled to a monetary remedy in the basis for case of Fraud; (ii) contain a description of the material facts and circumstances supporting the Indemnitee’s claim; and (iii) contain a good faith, non-binding, preliminary estimate of the aggregate amount of the actual and potential Damages that the Indemnitee reasonably believes have arisen and will arise as a result of such claim facts and each circumstances (the aggregate amount of such estimate, as it may be modified by the Indemnitee shall make available in good faith from time to time, being referred to as the “Claimed Amount”).
(b) During the 30-day period commencing upon delivery by the Indemnitee to the Securityholders’ Agent any documents and materials in such Indemnitee’s possession or control supporting the claims set forth in the Notice of Claim. In the event the Securityholders’ Agent does not notify the Indemnitee within thirty (30) days following its receipt applicable Indemnifying Party of a Notice of Claim (the “Claim Dispute Period”), the Indemnifying Party may deliver to the Indemnitee a written response (the “Response Notice”) in which the Indemnifying Party: (i) agrees that the Securityholders’ Agent full Claimed Amount is owed to the Indemnitee; (ii) agrees that part, but not all, of the Claimed Amount (such agreed portion, the “Agreed Amount”) is owed to the Indemnitee; or (iii) in good faith indicates that no part of the Claimed Amount is owed to the Indemnitee (or that no such right to indemnification has been finally determined). If the Response Notice is delivered in accordance with clause (ii) or (iii) of the preceding sentence, the Response Notice shall also contain a brief description of the facts and circumstances supporting the Indemnifying Party’s claim that only a portion or no part of the Claimed Amount is yet owed to the Indemnitee, as the case may be. Any part of the Claimed Amount that is not agreed to be owed to the Indemnitee pursuant to the Response Notice (or the entire Claimed Amount, if the Indemnifying Party asserts in the Response Notice that no part of the Claimed Amount is owed to the Indemnitee) is referred to in this Agreement as the “Contested Amount” (it being understood that the Contested Amount shall be modified from time to time to reflect any good faith modifications by the Indemnitee to the Claimed Amount). If no Response Notice is delivered before the expiration of the Claim Dispute Period, then the Indemnifying Party shall be conclusively deemed to have agreed that the full Claimed Amount is owed to the Indemnitee and may be recovered pursuant to Section 6.3(a), subject to application of the other limitations of Section 6.3 including the Deductible and Cap.
(c) If the Indemnifying Party delivers a Response Notice during the Claim Dispute Period indicating that there is a Contested Amount, the Indemnifying Party and the Indemnitee shall attempt in good faith to resolve the dispute related to the Contested Amount. If the Indemnitee and the Indemnifying Party resolve such dispute, a settlement agreement stipulating the amount owed to the Indemnitee (the “Stipulated Amount”) shall be signed by the Indemnitee, the Indemnitee and the Indemnifying Party; provided, that other than in the case of Fraud, in no event shall the Stipulated Amount be greater than the Cap.
(d) In the event that there is a dispute relating to any Notice of Claim or any Contested Amount (whether it is a matter between the Indemnitee (on behalf of itself and/or any Indemnitee(s)), on the Effective Time Holdersone hand, and the Indemnifying Party, on the other hand, or it is a matter that is subject to a Third Party Claim brought against any Indemnitee) disputes the liability that remains unresolved after application of the Effective Time Holders to the Indemnitee under this terms of Section 9 or the amount thereof6.5(a)-(c), the claim specified in such Notice of Claim dispute shall be conclusively deemed a liability of the Effective Time Holders under this Section 9, and Parent may claim from the Escrow Amount or, to the extent the remaining funds in the Escrow Amount are insufficient to cover the amount of such claim and such claim is not subject to the limitations set forth in Section 9.3(c) settled in accordance with Section 9.3(d), the Effective Time Holders shall pay the amount of such liability to the Indemnitee on demand or, in the case of any notice in which the amount of the claim (or any portion of the claim) is estimated, on such later date when the amount of such claim (or such portion of such claim) becomes finally determined. In the event the Securityholders’ Agent has timely disputed the liability of the Effective Time Holders (a “Claim Objection”) with respect to such claim as provided above, as promptly as possible, such Indemnitee and the Securityholders’ Agent shall establish the merits and amount of such claim (by mutual agreement, litigation, arbitration or otherwise) and if an agreement is reached, a memorandum setting forth such agreement shall be prepared and signed by both parties and shall be furnished to the Escrow Agent. If such Indemnitee and the Securityholders’ Agent do not reach an agreement as to the merits and amount of such claim within thirty (30) days immediately after the date such Claim Objection is delivered to Parent, either Parent or the Company (or the Securityholders’ Agent after the Effective Time) may demand arbitration of the matter unless the amount of the damage or loss is at issue in pending litigation or arbitration with a third party, in which event arbitration shall not be commenced until such amount is ascertained or both parties agree to arbitration. Any arbitration requested pursuant to this Section 9.6 shall be settled by arbitration conducted by three (3) arbitrators. Parent and the Company (or the Securityholders’ Agent after the Effective Time) shall each select one (1) arbitrator, and the two (2) arbitrators so selected shall select a third arbitrator. The arbitrator shall, within ten (10) Business Days after the last day of any hearings on any motion, issue a definitive ruling on such motion. The arbitrator shall also, within twenty (20) Business Days from the last day of any hearings regarding the imposition of sanctions or the issuance of any awards, issue a definitive ruling on the imposition of any such sanctions or the issuance of any such award in such arbitration. The arbitrator shall also establish procedures designed to reduce the cost and time for discovery, while allowing the parties a reasonable opportunity, adequate in the sole judgment of the arbitrator, to discover relevant information from the opposing parties about the subject matter of the dispute. The arbitrator shall rule upon motions to compel or limit discovery and shall have the authority to impose sanctions, including attorneys’ fees and costs, to the same extent as a court of competent law or equity, should the arbitrator determine that discovery was sought without substantial justification or that discovery was refused or objected to without substantial justification. The decision of the arbitrator, or a majority of the three (3) arbitrators, as applicable, shall be binding and conclusive upon the parties to this Agreement, and the Escrow Agent shall be entitled to act in accordance with such decision and make or withhold payments out of the Escrow Fund in accordance therewith. Such decision shall be written and shall be supported by written findings of fact and conclusions, which shall set forth the award, judgment, decree or order awarded by the arbitrator. Judgment upon any award rendered by the arbitrator may be entered in any court having jurisdiction. Any such arbitration shall be held in Wilmington, Delaware, under the rules then in effect of the American Arbitration Association7.2 hereof.
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Samples: Exchange Agreement (RetinalGenix Technologies Inc.)
Indemnification Claim Procedure. (a) If any Indemnitee has or reasonably believes it has claims in good faith to have incurred or suffered, or reasonably believes in good faith that it is reasonably likely to may incur or suffer, Damages for which it is or will may be entitled to be held harmless, indemnified, compensated or reimbursed under Section 9 this Article X or for which it is or will may be entitled to a monetary remedy (such as in the case of a claim based on Fraudulent breach of a representation or warranty herein by or on behalf of the Companyfraud), such Indemnitee may deliver a notice of claim (a “Notice of Claim”) to the Securityholders’ AgentIndemnifying Party; provided, however, that the failure timely to give a Notice of Claim shall affect the rights of an Indemnitee hereunder only to the extent that such failure has a materially prejudicial effect on the defenses or other rights available to the Indemnitee. Each Notice of Claim shall shall: (i) state that such Indemnitee believes in good faith that such Indemnitee is or may be entitled to indemnification, compensation or reimbursement under this Article X or is or may otherwise be entitled to a monetary remedy; (ii) contain a brief description of the basis for facts and circumstances supporting the Indemnitee’s claim; and (iii) if practicable, contain a good faith, non-binding, preliminary estimate of the aggregate amount of the actual and potential Damages that the Indemnitee believes have arisen and may arise as a result of such claim facts and each circumstances (the aggregate amount of such estimate, as it may be modified by such Indemnitee shall make available in good faith from time to time, being referred to as the “Claimed Amount”).
(b) During the 30-day period commencing upon delivery by an Indemnitee to the Securityholders’ Agent any documents and materials in such Indemnitee’s possession or control supporting the claims set forth in the Notice of Claim. In the event the Securityholders’ Agent does not notify the Indemnitee within thirty (30) days following its receipt Indemnifying Party of a Notice of Claim that (the Securityholders’ Agent (on behalf of “Dispute Period”), the Effective Time Holders) disputes the liability of the Effective Time Holders Indemnifying Party may deliver to the Indemnitee under this Section 9 or who delivered the amount thereof, the claim specified in such Notice of Claim a written response (the “Response Notice”) in which the Indemnifying Party: (i) agrees that the full Claimed Amount is owed to the Indemnitee; (ii) agrees that part, but not all, of the Claimed Amount (the “Agreed Amount”) is owed to the Indemnitee; or (iii) indicates that no part of the Claimed Amount is owed to the Indemnitee. If the Response Notice is delivered in accordance with clause (ii) or (iii) of the preceding sentence, the Response Notice shall also contain a brief description of the facts and circumstances supporting the Indemnifying Party’s claim that only a portion or no part of the Claimed Amount is owed to the Indemnitee, as the case may be. Any part of the Claimed Amount that is not agreed to be owed to the Indemnitee pursuant to the Response Notice (or the entire Claimed Amount, if the Indemnifying Party asserts in the Response Notice that no part of the Claimed Amount is owed to the Indemnitee) is referred to in this Agreement as the “Contested Amount” (it being understood that the Contested Amount shall be modified from time to time to reflect any good faith modifications by the Indemnitee to the Claimed Amount). If a Response Notice is not received by the Indemnitee prior to the expiration of the Dispute Period, then the Stockholders’ Agent shall be conclusively deemed a liability of to have agreed that the Effective Time Holders under this Section 9, and Parent may claim from the Escrow full Claimed Amount or, is owed to the extent Indemnitee.
(c) If: (i) the remaining funds in the Escrow Amount are insufficient to cover the amount of such claim and such claim is not subject Stockholders’ Agent delivers a Response Notice to the limitations set forth in Section 9.3(cIndemnitee agreeing that the full Claimed Amount is owed to the Indemnitee; or (ii) in accordance with Section 9.3(d)the Stockholders’ Agent does not deliver a Response Notice to the Indemnitee during the Dispute Period, then the Effective Time Holders Indemnifying Parties shall pay the amount of such liability Claimed Amount to the Indemnitee on demand or, in the case of any notice in which the amount of the claim (or any portion of the claim) is estimated, on such later date when the amount of such claim (or such portion of such claim) becomes finally determined. In the event the Securityholders’ Agent has timely disputed the liability of the Effective Time Holders (a “Claim Objection”) with respect to such claim as provided above, as promptly as possible, such Indemnitee and the Securityholders’ Agent shall establish the merits and amount of such claim (by mutual agreement, litigation, arbitration or otherwise) and if an agreement is reached, a memorandum setting forth such agreement shall be prepared and signed by both parties and shall be furnished to the Escrow Agent. If such Indemnitee and the Securityholders’ Agent do not reach an agreement as to the merits and amount of such claim within thirty (30) days immediately after the date such Claim Objection is delivered to Parent, either Parent or the Company (or the Securityholders’ Agent after the Effective Time) may demand arbitration of the matter unless the amount of the damage or loss is at issue in pending litigation or arbitration with a third party, in which event arbitration shall not be commenced until such amount is ascertained or both parties agree to arbitration. Any arbitration requested pursuant to this Section 9.6 shall be settled by arbitration conducted by three (3) arbitrators. Parent and Business Days.
(d) If the Company (or the Securityholders’ Agent after the Effective Time) shall each select one (1) arbitrator, and the two (2) arbitrators so selected shall select Indemnifying Party delivers a third arbitrator. The arbitrator shall, within ten (10) Business Days after the last day of any hearings on any motion, issue a definitive ruling on such motion. The arbitrator shall also, within twenty (20) Business Days from the last day of any hearings regarding the imposition of sanctions or the issuance of any awards, issue a definitive ruling on the imposition of any such sanctions or the issuance of any such award in such arbitration. The arbitrator shall also establish procedures designed to reduce the cost and time for discovery, while allowing the parties a reasonable opportunity, adequate in the sole judgment of the arbitrator, to discover relevant information from the opposing parties about the subject matter of the dispute. The arbitrator shall rule upon motions to compel or limit discovery and shall have the authority to impose sanctions, including attorneys’ fees and costs, Response Notice to the same extent as a court of competent law or equityIndemnitee during the Dispute Period agreeing that less than the full Claimed Amount is owed to the Indemnitee, should then the arbitrator determine that discovery was sought without substantial justification or that discovery was refused or objected Indemnifying Parties shall pay such lesser amount to without substantial justification. The decision of the arbitrator, or a majority of the Indemnitee within three (3) arbitratorsBusiness Days.
(e) If the Indemnifying Party delivers a Response Notice to the Indemnitee during the Dispute Period indicating that there is a Contested Amount, as applicablethe Indemnifying Party and the Indemnitee shall attempt in good faith to resolve the dispute related to the Contested Amount. If the Indemnitee and the Indemnifying Party resolve such dispute, then their resolution of such dispute shall be binding on the Indemnifying Party and conclusive upon such Indemnitee and a settlement agreement stipulating the parties amount owed to this Agreement, the Indemnitee (the “Stipulated Amount”) shall be signed by the Indemnitee and the Escrow Agent Indemnifying Party. The Indemnifying Party shall pay within three (3) Business Days following the execution of such settlement agreement (or such shorter period of time as may be entitled to act in accordance with such decision and make or withhold payments out of the Escrow Fund in accordance therewith. Such decision shall be written and shall be supported by written findings of fact and conclusions, which shall set forth in the award, judgment, decree or order awarded by settlement agreement) the arbitrator. Judgment upon any award rendered by Stipulated Amount to the arbitrator may be entered in any court having jurisdiction. Any such arbitration shall be held in Wilmington, Delaware, under the rules then in effect of the American Arbitration AssociationIndemnitee.
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Indemnification Claim Procedure. a. If any Indemnitee has or reasonably believes it has claims in good faith to have incurred or suffered, or reasonably believes in good faith that it is reasonably likely to may incur or suffer, Damages for which it is or will may be entitled to be held harmless, indemnified, compensated or reimbursed under Section 9 this Article 8 or for which it is or will may be entitled to a monetary remedy (such as in the case of a claim based on Fraudulent breach of a representation fraud or warranty herein by or on behalf of the Companyintentional misrepresentation), such Indemnitee may deliver a notice of claim (a “Notice of Claim”) to the Securityholders’ applicable Indemnitor (and, in the case the Notice of Claim is delivered by a Buyer Indemnitee, to the Escrow Agent, to the extent funds remain in the Escrow Account). Each Notice of Claim shall shall: (i) state that such Indemnitee believes in good faith that such Indemnitee is or may be entitled to indemnification, compensation or reimbursement under this Article 8 or is or may otherwise be entitled to a monetary remedy; (ii) contain a brief description of the basis for facts and circumstances supporting the Indemnitee’s claim; and (iii) contain a good faith, non-binding, preliminary estimate of the aggregate amount of the actual and potential Damages that the Indemnitee believes have arisen and may arise as a result of such claim facts and each circumstances (the aggregate amount of such estimate, as it may be modified by such Indemnitee shall make available in good faith from time to time, being referred to as the “Claimed Amount”).
b. During the twenty (20)-day period commencing upon delivery by an Indemnitee to the Securityholders’ Agent any documents and materials in such Indemnitee’s possession or control supporting the claims set forth in the Notice of Claim. In the event the Securityholders’ Agent does not notify the Indemnitee within thirty (30) days following its receipt applicable Indemnitor of a Notice of Claim that (the Securityholders’ Agent (on behalf of “Claim Dispute Period”), the Effective Time Holders) disputes the liability of the Effective Time Holders applicable Indemnitor may deliver to the Indemnitee under this Section 9 or who delivered the amount thereof, the claim specified in such Notice of Claim (and, in the case the Notice of Claim was delivered by a Buyer Indemnitee, to the Escrow Agent, to the extent funds remain in the Escrow Account) a written response (the “Response Notice”) in which the Indemnitor: (i) agrees that the full Claimed Amount is owed to the Indemnitee; (ii) agrees that part, but not all, of the Claimed Amount (such agreed portion, the “Agreed Amount”) is owed to the Indemnitee; or (iii) indicates that no part of the Claimed Amount is owed to the Indemnitee. If the Notice of Claim relates to a Third Party Claim, the Response Notice shall also specify whether or not the Indemnitor desires to assume control of the defense of such Third Party Claim. If the Response Notice is delivered in accordance with clause (ii) or (iii) of the preceding sentence, the Response Notice shall also contain a brief description of the facts and circumstances supporting the Indemnitor’s claim that only a portion or no part of the Claimed Amount is owed to the Indemnitee, as the case may be. Any part of the Claimed Amount that is not agreed to be 4826-7940-7793v12/101501-0066 owed to the Indemnitee pursuant to the Response Notice (or the entire Claimed Amount, if the Indemnitor asserts in the Response Notice that no part of the Claimed Amount is owed to the Indemnitee) is referred to in this Agreement as the “Contested Amount” (it being understood that the Contested Amount shall be modified from time to time to reflect any good faith modifications by the Indemnitee to the Claimed Amount). If no Response Notice is delivered prior to the expiration of the Claim Dispute Period, then the Indemnitor shall be conclusively deemed to have agreed that the full Claimed Amount is owed to the Indemnitee.
c. If: (i) the Indemnitor delivers a liability Response Notice agreeing that the full Claimed Amount is owed to the Indemnitee; or (ii) the Indemnitor does not deliver a Response Notice during the Claim Dispute Period, then, within three (3) Business Days following the receipt of such Response Notice by the Indemnitee (or, in the case the Notice of Claim was delivered by a Buyer Indemnitee, by the Escrow Agent) or within three (3) Business Days after the expiration of the Effective Time Holders under this Section 9Claim Dispute Period, as the case may be, the Indemnitor shall pay to the applicable Indemnitee an amount in cash equal to the full Claimed Amount (or, in the case the Notice of Claim was delivered by a Buyer Indemnitee and Parent may claim funds remain in the Escrow Account, the Escrow Agent shall release to the applicable Buyer Indemnitee from the Escrow Account an amount in cash equal to the full Claimed Amount or(or such lesser amount as may remain in the Escrow Account)); provided, however, that, in the case the Notice of Claim was delivered by a Buyer Indemnitee and to the extent the funds in the Escrow Account are insufficient to cover the Claimed Amount, Seller shall promptly pay to the applicable Buyer Indemnitee the amount by which the Claimed Amount exceeds the remaining funds in the Escrow Account.
d. If the Indemnitor delivers a Response Notice during the Claim Dispute Period agreeing that less than the full Claimed Amount is owed to the Indemnitee, then within three (3) Business Days following the receipt of such Response Notice, the Indemnitor shall pay to the applicable Indemnitee an amount in cash equal to the Agreed Amount (or, in the case the Notice of Claim was delivered by a Buyer Indemnitee and funds remain in the Escrow Account, the Escrow Agent shall release to the applicable Buyer Indemnitee from the Escrow Account an amount in cash equal to the Agreed Amount (or such lesser amount as may remain in the Escrow Account)); provided, however, that, in the case the Notice of Claim was delivered by a Buyer Indemnitee and to the extent the funds in the Escrow Account are insufficient to cover the Agreed Amount, Seller shall promptly pay to the applicable Buyer Indemnitee the amount by which the Agreed Amount exceeds the remaining funds in the Escrow Account.
(a) If the Indemnitor delivers a Response Notice during the Claim Dispute Period indicating that there is a Contested Amount, the Indemnitor and the Indemnitee shall attempt in good faith to resolve the dispute related to the Contested Amount. If the Indemnitee and the Indemnitor resolve such dispute, a settlement agreement stipulating the amount owed to the Indemnitee (the “Stipulated Amount”) shall be signed by the Indemnitee and the Indemnitor. Within three (3) Business Days following the execution of such claim and settlement agreement (or such claim is not subject to the limitations shorter period of time as may be set forth in Section 9.3(c) in accordance with Section 9.3(dthe settlement agreement), the Effective Time Holders Indemnitor shall pay the amount of such liability to the applicable Indemnitee on demand an amount in cash equal to the Stipulated Amount (or, in the case the Notice of any notice Claim was delivered by a Buyer Indemnitee and funds remain in which the Escrow Account, Seller and Buyer shall deliver joint written instructions to the Escrow Agent instructing the Escrow Agent to release to the applicable Buyer Indemnitee from the Escrow Account an amount of in cash equal to the claim (or any portion of the claim) is estimated, on such later date when the amount of such claim Stipulated Amount (or such portion lesser amount as may remain in the Escrow Account)); provided, however, that, in the case the Notice of such claimClaim was delivered by a Buyer Indemnitee and to the extent the funds in the Escrow Account are insufficient to cover the Stipulated Amount, Seller shall promptly pay to the applicable Buyer Indemnitee the amount by which the Stipulated Amount exceeds the remaining funds in the Escrow Account. 4826-7940-7793v12/101501-0066
(b) becomes finally determined. In the event that there is a dispute relating to any Notice of Claim or any Contested Amount (whether it is a matter between any Indemnitee, on the Securityholders’ Agent has timely disputed one hand, and the liability applicable Indemnitor, on the other hand, or it is a matter that is subject to a Third Party Claim brought against any Indemnitee), that remains unresolved after application of the Effective Time Holders (a “Claim Objection”) with respect to such claim as provided above, as promptly as possibleterms of this Section 8.6, such Indemnitee and the Securityholders’ Agent shall establish the merits and amount of such claim (by mutual agreement, litigation, arbitration or otherwise) and if an agreement is reached, a memorandum setting forth such agreement shall be prepared and signed by both parties and shall be furnished to the Escrow Agent. If such Indemnitee and the Securityholders’ Agent do not reach an agreement as to the merits and amount of such claim within thirty (30) days immediately after the date such Claim Objection is delivered to Parent, either Parent or the Company (or the Securityholders’ Agent after the Effective Time) may demand arbitration of the matter unless the amount of the damage or loss is at issue in pending litigation or arbitration with a third party, in which event arbitration shall not be commenced until such amount is ascertained or both parties agree to arbitration. Any arbitration requested pursuant to this Section 9.6 dispute shall be settled by arbitration conducted by three (3) arbitrators. Parent and the Company (or the Securityholders’ Agent after the Effective Time) shall each select one (1) arbitrator, and the two (2) arbitrators so selected shall select a third arbitrator. The arbitrator shall, within ten (10) Business Days after the last day of any hearings on any motion, issue a definitive ruling on such motion. The arbitrator shall also, within twenty (20) Business Days from the last day of any hearings regarding the imposition of sanctions or the issuance of any awards, issue a definitive ruling on the imposition of any such sanctions or the issuance of any such award in such arbitration. The arbitrator shall also establish procedures designed to reduce the cost and time for discovery, while allowing the parties a reasonable opportunity, adequate in the sole judgment of the arbitrator, to discover relevant information from the opposing parties about the subject matter of the dispute. The arbitrator shall rule upon motions to compel or limit discovery and shall have the authority to impose sanctions, including attorneys’ fees and costs, to the same extent as a court of competent law or equity, should the arbitrator determine that discovery was sought without substantial justification or that discovery was refused or objected to without substantial justification. The decision of the arbitrator, or a majority of the three (3) arbitrators, as applicable, shall be binding and conclusive upon the parties to this Agreement, and the Escrow Agent shall be entitled to act in accordance with such decision and make or withhold payments out of the Escrow Fund in accordance therewith. Such decision shall be written and shall be supported by written findings of fact and conclusions, which shall set forth the award, judgment, decree or order awarded by the arbitrator. Judgment upon any award rendered by the arbitrator may be entered in any court having jurisdiction. Any such arbitration shall be held in Wilmington, Delaware, under the rules then in effect of the American Arbitration AssociationSection 11.8.
Appears in 1 contract
Samples: Asset Purchase Agreement (Ligand Pharmaceuticals Inc)
Indemnification Claim Procedure. (a) If any Indemnitee has or reasonably believes it has claims in good faith to have incurred or suffered, or reasonably believes in good faith that it is reasonably likely to may incur or suffer, Damages for which it is or will may be entitled to be held harmless, indemnified, compensated or reimbursed under Section 9 or for which it is or will be entitled to a monetary remedy (such as in the case of a claim based on Fraudulent breach of a representation or warranty herein by or on behalf of the Company)this Article IX, such Indemnitee may shall deliver a notice of claim prior to the expiration of the applicable claim survival period (a “Notice of Claim”) to the SecurityholdersStockholders’ AgentRepresentative. Each Notice of Claim shall shall: (i) state that such Indemnitee believes in good faith that such Indemnitee is or may be entitled to indemnification, compensation or reimbursement under this Article IX; (ii) contain a reasonably detailed description of the basis for such claim facts and each Indemnitee shall make available to the Securityholders’ Agent any documents and materials in such circumstances supporting Indemnitee’s possession or control supporting claim; and (iii) contain a good faith, non-binding, preliminary estimate of the claims set forth aggregate amount of the actual and potential Damages (estimated in good faith) that Indemnitee believes have arisen and may arise as a result of such facts and circumstances (the Notice of Claim. In “Claimed Amount”).
(b) During the event the Securityholderstwenty (20) Business Day period commencing upon delivery by an Indemnitee to Stockholders’ Agent does not notify the Indemnitee within thirty (30) days following its receipt Representative of a Notice of Claim that (the Securityholders“Claim Dispute Period”), Stockholders’ Agent (on behalf of the Effective Time Holders) disputes the liability of the Effective Time Holders Representative may deliver to the Indemnitee under this Section 9 or that delivered the amount thereof, the claim specified in such Notice of Claim a written response (the “Response Notice”) in which Stockholders’ Representative: (i) agrees that the full Claimed Amount is owed to the applicable Indemnitee; (ii) agrees that part, but not all, of the Claimed Amount (such agreed portion, the “Agreed Amount”) is owed to the applicable Indemnitee; or (iii) indicates that no part of the Claimed Amount is owed to the applicable Indemnitee. If the Response Notice is delivered in accordance with clause (ii) or (iii) of the preceding sentence, the Response Notice shall also contain a brief description of the facts and circumstances supporting Stockholders’ Representative’s claim that only a portion or no part of the Claimed Amount is owed to such Indemnitee, as the case may be. Any part of the Claimed Amount that is not agreed to be owed to Indemnitee pursuant to the Response Notice (or the entire Claimed Amount, if Stockholders’ Representative asserts in the Response Notice that no part of the Claimed Amount is owed to Indemnitee) is referred to in this Agreement as the “Contested Amount”. If no Response Notice is delivered prior to the expiration of the Claim Dispute Period, then Stockholders’ Representative shall be conclusively deemed to have agreed that the full Claimed Amount is owed to Indemnitee.
(c) If: (i) Stockholders’ Representative delivers a liability Response Notice agreeing that the full Claimed Amount is owed to Indemnitee; or (ii) Stockholders’ Representative does not deliver a Response Notice during the Claim Dispute Period, then: (x) if the Then Remaining Holdback Amount (as defined below) as of the Effective Time Holders under this Section 9date of the delivery of such Response Notice or the expiration date of the Claim Dispute Period is greater than or equal to the Claimed Amount, the Then Remaining Holdback Amount shall be adjusted pursuant to the formula set forth as the definition of the “Then Remaining Holdback Amount” below; but (y) if the Then Remaining Holdback Amount (as defined below) as of the date of delivery of such Response Notice or the expiration date of the Claim Dispute Period is less than the Claimed Amount, the Stockholders’ Representative shall provide written notice thereof to each Stockholder, and Parent may claim from the Escrow Amount or, each Stockholder shall pay to the extent applicable Indemnitee, within five (5) Business Days following the remaining funds in the Escrow Amount are insufficient to cover receipt by such Stockholder of such written notice, such Stockholder’s Pro Rata Share of the amount by which the Claimed Amount exceeds the Then Remaining Holdback Amount. The “Then Remaining Holdback Amount” as of such claim a particular date shall be the amount by which the Holdback Amount exceeds the sum of: the aggregate of all amounts deemed or determined to be due and such claim is not subject owing to the limitations set forth in Section 9.3(c) in accordance with Section 9.3(d), the Effective Time Holders shall pay the amount of such liability to the Indemnitee on demand or, in the case of any notice in which the amount of the claim (or any portion of the claim) is estimated, on such later date when the amount of such claim (or such portion of such claim) becomes finally determined. In the event the Securityholders’ Agent has timely disputed the liability of the Effective Time Holders (a “Claim Objection”) with respect to such claim as provided above, as promptly as possible, such Indemnitee and the Securityholders’ Agent shall establish the merits and amount of such claim (by mutual agreement, litigation, arbitration or otherwise) and if an agreement is reached, a memorandum setting forth such agreement shall be prepared and signed by both parties and shall be furnished to the Escrow Agent. If such Indemnitee and the Securityholders’ Agent do not reach an agreement as to the merits and amount of such claim within thirty (30) days immediately after the date such Claim Objection is delivered to Parent, either Parent or the Company (or the Securityholders’ Agent after the Effective Time) may demand arbitration of the matter unless the amount of the damage or loss is at issue in pending litigation or arbitration with a third party, in which event arbitration shall not be commenced until such amount is ascertained or both parties agree to arbitration. Any arbitration requested Indemnitees pursuant to this Section 9.6 shall be settled by arbitration conducted by three (3) arbitrators. Parent prior to such date and the Company (aggregate amount deemed or the Securityholders’ Agent after the Effective Time) shall each select one (1) arbitrator, determined to be due and the two (2) arbitrators so selected shall select a third arbitrator. The arbitrator shall, within ten (10) Business Days after the last day of any hearings on any motion, issue a definitive ruling on such motion. The arbitrator shall also, within twenty (20) Business Days from the last day of any hearings regarding the imposition of sanctions or the issuance of any awards, issue a definitive ruling on the imposition of any such sanctions or the issuance of any such award in such arbitration. The arbitrator shall also establish procedures designed to reduce the cost and time for discovery, while allowing the parties a reasonable opportunity, adequate in the sole judgment of the arbitrator, to discover relevant information from the opposing parties about the subject matter of the dispute. The arbitrator shall rule upon motions to compel or limit discovery and shall have the authority to impose sanctions, including attorneys’ fees and costs, owing to the same extent as a court of competent law or equity, should the arbitrator determine that discovery was sought without substantial justification or that discovery was refused or objected Purchaser pursuant to without substantial justification. The decision of the arbitrator, or a majority of the three (3) arbitrators, as applicable, shall be binding and conclusive upon the parties to this Agreement, and the Escrow Agent shall be entitled to act in accordance with such decision and make or withhold payments out of the Escrow Fund in accordance therewith. Such decision shall be written and shall be supported by written findings of fact and conclusions, which shall set forth the award, judgment, decree or order awarded by the arbitrator. Judgment upon any award rendered by the arbitrator may be entered in any court having jurisdiction. Any such arbitration shall be held in Wilmington, Delaware, under the rules then in effect of the American Arbitration AssociationSection 2.10(d)(ii).
Appears in 1 contract
Samples: Merger Agreement (Appfolio Inc)
Indemnification Claim Procedure. Subject to Sections 9.5(c), 9.5(f) and 10.9(c), any claim for indemnification, compensation or reimbursement pursuant to this Section 9 shall be brought and resolved exclusively as follows:
(a) If any Indemnitee has or reasonably believes it has claims in good faith to have incurred or suffered, or reasonably believes in good faith that it is reasonably likely to may incur or suffer, Damages for which it is or will may be entitled to be held harmless, indemnified, compensated or reimbursed under Section 9 or for which it is or will may be entitled to a monetary remedy (such as including in the case of a claim based on Fraudulent breach of a representation intentional misrepresentation or warranty herein by or on behalf of the Companyfraud), such Indemnitee may deliver a notice of claim (a “Notice of Claim”) to the Securityholders’ AgentAgent or Non-Dissenting Equityholder. Each Notice of Claim shall shall: (i) state that such Indemnitee believes in good faith that such Indemnitee is or may be entitled to indemnification, compensation or reimbursement under Section 9 or is or may otherwise be entitled to a monetary remedy; (ii) contain a brief description of the basis for facts and circumstances supporting such claim Indemnitee’s claim; and each (iii) if practicable, contain a non-binding, preliminary estimate of the aggregate amount of the actual and potential Damages that the Indemnitee shall make available believes have arisen and may arise as a result of such facts and circumstances (the aggregate amount of such estimate, as it may be modified by such Indemnitee from time to time, being referred to as the “Claimed Amount”).
(b) During the 30-day period commencing upon delivery by an Indemnitee to the Securityholders’ Agent any documents and materials in such Indemnitee’s possession or control supporting a Non-Dissenting Equityholder of a Notice of Claim (the claims set forth in “Dispute Period”), the Securityholders’ Agent may deliver to the Indemnitee who delivered the Notice of ClaimClaim a written response (the “Response Notice”) in which the Securityholders’ Agent: (i) agrees that the full Claimed Amount is owed to such Indemnitee; (ii) agrees that part, but not all, of the Claimed Amount (the “Agreed Amount”) is owed to the Indemnitee; or (iii) indicates that no part of the Claimed Amount is owed to such Indemnitee. In If the event Response Notice is delivered in accordance with clause “(ii)” or “(iii)” of the preceding sentence, such Response Notice shall also contain a brief description of the facts and circumstances supporting the Securityholders’ Agent’s claim that only a portion or no part of the Claimed Amount is owed to the Indemnitee, as the case may be. Any part of the Claimed Amount that is not agreed to be owed to the Indemnitee pursuant to the Response Notice (or the entire Claimed Amount, if the Securityholders’ Agent asserts in the Response Notice that no part of the Claimed Amount is owed to the Indemnitee) is referred to in this Agreement as the “Contested Amount” (it being understood that the Contested Amount shall be subject to modification from time to time to reflect any modifications by the Indemnitee to the Claimed Amount). If a Response Notice is not received by the Indemnitee prior to the expiration of the Dispute Period, then the Securityholders’ Agent shall be conclusively deemed to have agreed that the full Claimed Amount is owed to the Indemnitee.
(c) If (i) the Securityholders’ Agent delivers a Response Notice to the Indemnitee agreeing that the full Claimed Amount is owed to the Indemnitee or (ii) the Securityholders’ Agent does not notify deliver a Response Notice to the Indemnitee within thirty during the Dispute Period, then: (30A) days following its receipt of if cash remains in the Escrow Fund (that is not subject to a Notice of Claim that pending claim), Parent and the Securityholders’ Agent (on behalf shall, within three Business Days following the earlier of the Effective Time Holders) disputes delivery date of such Response Notice and the liability expiration date of the Effective Time Holders Dispute Period, jointly execute and deliver to the Escrow Agent a written notice instructing the Escrow Agent to pay the Claimed Amount to the Indemnitee under this Section 9 or the amount thereof, the claim specified in such Notice of Claim shall be conclusively deemed a liability of the Effective Time Holders under this Section 9, and Parent may claim from the Escrow Amount or, to Fund and (B) if the extent the remaining funds amount available in the Escrow Amount are Fund (that is not subject to a pending claim) is insufficient for whatever reason to cover the full Claimed Amount, then, subject to the limitations provided for in Section 9.3, each Non-Dissenting Equityholder shall, within 10 Business Days following receipt of notice by such Non-Dissenting Equityholder, pay such Non-Dissenting Equityholder’s Pro Rata Share of the amount of such claim and shortfall to the Indemnitee (with such claim payment being made in substantial compliance with the payment instructions set forth in such notice).
(d) If the Securityholders’ Agent delivers a Response Notice to the Indemnitee during the Dispute Period agreeing that less than the full Claimed Amount is owed to the Indemnitee, then: (i) if cash remains in the Escrow Fund (that is not subject to a pending claim), Parent and the Securityholders’ Agent shall, within three Business Days following the receipt of such Response Notice, jointly execute and deliver to the Escrow Agent a written notice instructing the Escrow Agent to pay the Agreed Amount to the Indemnitee from the Escrow Fund and (ii) if the amount available in the Escrow Fund (that is not subject to a pending claim) is insufficient for whatever reason to cover the full Agreed Amount, then, subject to the limitations set forth provided for in Section 9.3(c) in accordance with Section 9.3(d)9.3, the Effective Time Holders shall each Non-Dissenting Equityholder shall, within 10 Business Days following receipt of notice by such Non-Dissenting Equityholder, pay such Non-Dissenting Equityholder’s Pro Rata Share of the amount of such liability shortfall to the Indemnitee on demand or, (with such payment being made in substantial compliance with the case of any notice payment instructions set forth in which the amount of the claim such notice).
(or any portion of the claime) is estimated, on such later date when the amount of such claim (or such portion of such claim) becomes finally determined. In the event If the Securityholders’ Agent has timely disputed delivers a Response Notice to the liability of Indemnitee during the Effective Time Holders Dispute Period indicating that there is a Contested Amount, the Securityholders’ Agent and the Indemnitee shall attempt in good faith to resolve the dispute related to the Contested Amount within 30 days after the date on which the Securityholders’ Agent delivers such Response Notice (a “Claim Objection”) with respect to or such claim longer period as provided above, as promptly as possible, such the Indemnitee and the Securityholders’ Agent shall establish the merits and amount of such claim (by mutual agreement, litigation, arbitration or otherwise) and if an agreement is reached, a memorandum setting forth such agreement shall be prepared and signed by both parties and shall be furnished to the Escrow Agentmay mutually agree in writing). If such the Indemnitee and the Securityholders’ Agent do not reach an resolve such dispute during such period, then their resolution of such dispute shall be binding on the Securityholders’ Agent, the Non-Dissenting Equityholders and such Indemnitee and a settlement agreement as stipulating the amount owed to the merits Indemnitee (the “Stipulated Amount”) shall be signed by the Indemnitee and the Securityholders’ Agent. If cash remains in the Escrow Fund (that is not subject to a pending claim), Parent and the Securityholders’ Agent shall, within three Business Days following the execution of such settlement agreement (or such shorter period of time as may be set forth in the settlement agreement), jointly execute and deliver to the Escrow Agent a written notice instructing the Escrow Agent to pay the Stipulated Amount to the Indemnitee from the Escrow Fund. If the amount available in the Escrow Fund (that is not subject to a pending claim) is insufficient for whatever reason to cover the full Stipulated Amount, then, subject to the limitations provided for in Section 9.3, each Non-Dissenting Equityholder shall, within 10 Business Days following the receipt of notice of the execution of such settlement agreement, pay such Non-Dissenting Equityholder’s Pro Rata Share of the amount of such claim shortfall to the Indemnitee (with such payment being made in substantial compliance with the payment instructions set forth in such notice).
(f) In the event that the Indemnitee and the Securityholders’ Agent fail to reach a resolution on a Notice of Claim or Contested Amount that is the subject of a Response Notice, such dispute shall be resolved by either (i) a written settlement agreement executed by Parent and the Securityholders’ Agent within thirty (30) 30 days immediately after the date on which the Securityholders’ Agent delivers such Claim Objection Response Notice indicating there is delivered a Contested Amount (or such longer period as the Indemnitee and the Securityholders’ Agent may mutually agree in writing) (whether it is a matter between the Indemnitee, on the one hand, and the Securityholders’ Agent, on the other hand, or it is a matter that is subject to Parenta claim or Legal Proceeding asserted or commenced by a third party brought against the Indemnitee or any Acquired Company) or (ii) in the absence of such a written settlement agreement within 30 days following delivery of the Response Notice by the Securityholders’ Agent, either by litigation between Parent and the Securityholders’ Agent or one or more Non-Dissenting Equityholders in accordance with the Company (terms and provisions of this Section 9.6(f). During the 30-day period following the Response Notice indicating there is a Contested Amount, the Securityholders’ Agent and Parent shall act in good faith to resolve the Contested Amount. Either Parent or the Securityholders’ Agent after may bring suit in the Effective Time) may demand arbitration Court of Chancery of the matter unless State of Delaware to resolve a Contested Amount to the amount of the damage or loss is at issue in pending litigation or arbitration with a third party, in which event arbitration shall not be commenced until such amount is ascertained or both parties agree to arbitration. Any arbitration requested pursuant to this Section 9.6 shall be settled by arbitration conducted by three (3) arbitrators. Parent and the Company (or extent the Securityholders’ Agent after and Parent are unable to resolve such Contested Amount during the Effective Time) shall each select one (1) arbitrator, and the two (2) arbitrators so selected shall select a third arbitrator30-day period contemplated by this Section 9.6(f). The arbitrator shall, within ten (10) Business Days after the last day of any hearings on any motion, issue a definitive ruling on such motion. The arbitrator shall also, within twenty (20) Business Days from the last day of any hearings regarding the imposition of sanctions or the issuance of any awards, issue a definitive ruling on the imposition of any such sanctions or the issuance of any such award in such arbitration. The arbitrator shall also establish procedures designed to reduce the cost and time for discovery, while allowing the parties a reasonable opportunity, adequate in the sole judgment of the arbitrator, to discover relevant information from the opposing parties about the subject matter of the dispute. The arbitrator shall rule upon motions to compel or limit discovery and shall have the authority to impose sanctions, including attorneys’ fees and costs, to the same extent as a court of competent law or equity, should the arbitrator determine that discovery was sought without substantial justification or that discovery was refused or objected to without substantial justification. The decision of the arbitrator, or a majority of the three (3) arbitrators, as applicable, shall be binding and conclusive upon the parties to this Agreement, and the Escrow Agent shall be entitled to act in accordance with such any non-appealable decision by a court with applicable jurisdiction or with the written consent of the Parent and the Securityholders’ Agent and make or withhold payments out of the Escrow Fund Amount in accordance therewith. Such decision Any Person shall pay its own expenses incurred in connection with any such suit. Following the delivery of a Notice of Claim, the Securityholders’ Agent and its representatives and agents shall be given all such reasonable access (including electronic access, to the extent available) as they may reasonably require to the books and records of the Surviving Corporation and access to such personnel or representatives of the Surviving Corporation and Parent, including but not limited to the individuals responsible for the matters that are the subject of the Notice of Claim, as they may reasonably require for the purposes of investigating or resolving any disputes or responding to any matters or inquiries raised in the Notice of Claim.
(g) Promptly after the General Representation Expiration Date, Parent shall notify the Securityholders’ Agent in writing of the amount that Parent determines in good faith to be necessary to satisfy all claims made by an Indemnitee pursuant to Section 9.2 that have been asserted, but not resolved prior to the General Representation Expiration Date (each such claim an “Unresolved Claim” and such amount, the “Retained Escrow Amount”). Within 10 Business Days after the General Representation Expiration Date, Parent and the Securityholders’ Agent shall, subject to Section 9.6(i), jointly execute and deliver to the Escrow Agent a written notice instructing the Escrow Agent to release from the balance of the Escrow Fund to (i) the Payment Agent, for distribution to each Non-Dissenting Stockholder and shall be supported each former holder of a Company Warrant, an amount equal to such holder’s Pro Rata Share of the amount, if any, by written findings which the aggregate amount remaining in the Escrow Fund as of fact the General Representation Expiration Date exceeds the Retained Escrow Amount and conclusions(ii) the Surviving Corporation, which shall set forth the awardfor distribution to each former holder of a Company Option or Company RSU, judgment, decree or order awarded an amount (reduced by the arbitrator. Judgment upon amount of any award rendered Taxes required to be withheld under applicable Legal Requirements with respect to such payments) equal to such holder’s Pro Rata Share of the amount, if any, by which the arbitrator may aggregate amount remaining in the Escrow Fund as of the General Escrow Expiration Date exceeds the Retained Escrow Amount.
(h) Following the General Representation Expiration Date, if any Unresolved Claim is finally resolved, then Parent and the Securityholders’ Agent shall, subject to Section 9.6(i), jointly execute and deliver to the Escrow Agent within three Business Days after the final resolution of such Unresolved Claim and the delivery to the Indemnitee of the amount to be entered delivered to the Indemnitee from the Escrow Fund pursuant to Section 9, a written notice instructing the Escrow Agent to release from the Escrow Fund to (i) the Payment Agent, for distribution to each Non-Dissenting Stockholder and each former holder of a Company Warrant, an amount equal to such holder’s Pro Rata Share of the amount (if any) by which the aggregate amount held in any court having jurisdiction. Any the Escrow Fund as of the time of such arbitration shall disbursement exceeds the amounts that Parent determines in good faith to be necessary to satisfy all remaining Unresolved Claims (which amounts will continue to be held in Wilmingtonthe Escrow Fund pursuant to the terms hereof) and (ii) the Surviving Corporation, Delawarefor distribution to each former holder of a Company Option or Company RSU, an amount (reduced by the amount of any Taxes required to be withheld under the rules then in effect applicable Legal Requirements with respect to such payments) equal to such holder’s Pro Rata Share of the American Arbitration Associationamount, if any, by which the aggregate the amount (if any) by which the aggregate amount held in the Escrow Fund as of the time of such disbursement exceeds the amounts that Parent determines in good faith to be necessary to satisfy all remaining Unresolved Claims (which amounts will continue to be held in the Escrow Fund pursuant to the terms hereof).
(i) Notwithstanding anything to the contrary contained in this Agreement, if any amount is due to be released to a particular Non-Dissenting Equityholder from the Escrow Fund prior to the Payment Compliance Date for such Non-Dissenting Equityholder, if applicable, Parent and the Securityholders’ Agent shall instruct the Escrow Agent to distribute to Parent the amount that would otherwise be distributed to such Non-Dissenting Equityholder, Parent shall retain such amount until the Payment Compliance Date for such Non-Dissenting Equityholder and Parent shall distribute (or cause the Payment Agent to distribute) such amount to such Non-Dissenting Equityholder promptly following such Payment Compliance Date. For purposes of this Agreement, the “Payment Compliance Date” for a particular Non-Dissenting Stockholder or holder of a Company Warrant means the first date upon which such Non-Dissenting Equityholder has validly surrendered all Company Stock Certificates formerly evidencing the Capital Stock held by such Non-Dissenting Stockholder or all Company Warrants held by such Non-Dissenting Equityholder (or a Lost Certificate Affidavit relating to the same) in accordance with Section 1.9.
Appears in 1 contract
Samples: Merger Agreement (Ca, Inc.)
Indemnification Claim Procedure. If any Indemnitee has or reasonably believes it has claims in good faith to have incurred or suffered, or reasonably believes in good faith that it is reasonably likely to may incur or suffer, Damages for which it is or will may be entitled to be held harmless, indemnified, compensated or reimbursed under Section 9 or for which it is or will may be entitled to a monetary remedy (such as in the case of a claim based on Fraudulent breach of a representation willful misconduct, intentional misrepresentation or warranty herein by or on behalf of the Companyfraud), such Indemnitee may deliver a notice of claim (a “Notice of Claim”) to the Securityholders’ Agent. Each Notice of Claim shall state the basis for such claim and each Indemnitee shall make available to the Securityholders’ Agent any documents and materials in such Indemnitee’s possession or control supporting the claims set forth in the Notice of Claim. In the event the Securityholders’ Agent does not notify the Indemnitee within thirty (30) days following its receipt of a Notice of Claim that the Securityholders’ Agent (on behalf of the Effective Time Holders) disputes the liability of the Effective Time Holders to the Indemnitee under this Section 9 or the amount thereof, the claim specified in such Notice of Claim shall be conclusively deemed a liability of the Effective Time Holders under this Section 9, and Parent may claim from the Escrow Amount or, to the extent the remaining funds in the Escrow Amount are insufficient to cover the amount of such claim and such claim is not subject to the limitations set forth in Section 9.3(c) in accordance with Section 9.3(d), the Effective Time Holders shall pay the amount of such liability to the Indemnitee on demand or, in the case of any notice in which the amount of the claim (or any portion of the claim) is estimated, on such later date when the amount of such claim (or such portion of such claim) becomes finally determined. In the event the Securityholders’ Agent has timely disputed the liability of the Effective Time Holders (a “Claim Objection”) with respect to such claim as provided above, as promptly as possible, such Indemnitee and the Securityholders’ Agent shall establish the merits and amount of such claim (by mutual agreement, litigation, arbitration or otherwise) and if an agreement is reached, a memorandum setting forth such agreement shall be prepared and signed by both parties and shall be furnished to the Escrow Agent. If such Indemnitee and the Securityholders’ Agent do not reach an agreement as to the merits and amount of such claim within thirty (30) days immediately after the date such Claim Objection is delivered to Parent, either Parent or the Company (or the Securityholders’ Agent Securityholder Representative after the Effective Time) may demand arbitration of the matter unless the amount of the damage or loss is at issue in pending litigation or arbitration with a third party, in which event arbitration shall not be commenced until such amount is ascertained or both parties agree to arbitration. Any arbitration requested pursuant to this Section 9.6 shall be settled by arbitration conducted by three (3) arbitrators. Parent and the Company (or the Securityholders’ Agent after the Effective Time) shall each select one (1) arbitrator, and the two (2) arbitrators so selected shall select a third arbitrator. The arbitrator shall, within ten (10) Business Days after the last day of any hearings on any motion, issue a definitive ruling on such motion. The arbitrator shall also, within twenty (20) Business Days from the last day of any hearings regarding the imposition of sanctions or the issuance of any awards, issue a definitive ruling on the imposition of any such sanctions or the issuance of any such award in such arbitration. The arbitrator shall also establish procedures designed to reduce the cost and time for discovery, while allowing the parties a reasonable opportunity, adequate in the sole judgment of the arbitrator, to discover relevant information from the opposing parties about the subject matter of the dispute. The arbitrator shall rule upon motions to compel or limit discovery and shall have the authority to impose sanctions, including attorneys’ fees and costs, to the same extent as a court of competent law or equity, should the arbitrator determine that discovery was sought without substantial justification or that discovery was refused or objected to without substantial justification. The decision of the arbitrator, or a majority of the three (3) arbitrators, as applicable, shall be binding and conclusive upon the parties to this Agreement, and the Escrow Agent shall be entitled to act in accordance with such decision and make or withhold payments out of the Escrow Fund in accordance therewith. Such decision shall be written and shall be supported by written findings of fact and conclusions, which shall set forth the award, judgment, decree or order awarded by the arbitrator. Judgment upon any award rendered by the arbitrator may be entered in any court having jurisdiction. Any such arbitration shall be held in Wilmington, Delaware, under the rules then in effect of the American Arbitration Association.select
Appears in 1 contract
Indemnification Claim Procedure. (a) If any Indemnitee has or reasonably believes it has claims in good faith to have incurred or suffered, or reasonably believes in good faith that it is reasonably likely to may incur or suffer, Damages for which it is or will may be entitled to be held harmless, indemnified, compensated or reimbursed under Section 9 this Article IX or for which it is or will may be entitled to a monetary remedy (such as in the case of a claim based on Fraudulent breach of a representation fraud or warranty herein by or on behalf of the Companyintentional misrepresentation), such Indemnitee may deliver a notice of claim (a “Notice of Claim”) to the SecurityholdersSellers’ Representative and, to the extent funds remain in the Indemnity Escrow Account, 50 to the Escrow Agent. Each Notice of Claim shall shall: (i) state that such Indemnitee believes in good faith that such Indemnitee is or may be entitled to indemnification, compensation or reimbursement under this Article IX or is or may otherwise be entitled to a monetary remedy; (ii) contain a brief description of the basis for facts and circumstances supporting the Indemnitee’s claim; and (iii) contain a good faith, non-binding, preliminary estimate of the aggregate amount of the actual and potential Damages that the Indemnitee believes have arisen and may arise as a result of such claim facts and each circumstances (the aggregate amount of such estimate, as it may be modified by such Indemnitee shall make available in good faith from time to time, being referred to as the “Claimed Amount”).
(b) During the thirty (30)-day period commencing upon delivery by an Indemnitee to the SecurityholdersSellers’ Agent any documents and materials in such Indemnitee’s possession or control supporting the claims set forth in the Notice of Claim. In the event the Securityholders’ Agent does not notify the Indemnitee within thirty (30) days following its receipt Representative of a Notice of Claim that (the Securityholders“Dispute Period”), the Sellers’ Agent (on behalf of the Effective Time Holders) disputes the liability of the Effective Time Holders Representative may deliver to the Indemnitee under this Section 9 or who delivered the amount thereof, the claim specified in such Notice of Claim and, to the extent funds remain in the Indemnity Escrow Account, to the Escrow Agent a written response (the “Response Notice”) in which the Sellers’ Representative: (i) agrees that the full Claimed Amount is owed to the Indemnitee; (ii) agrees that part, but not all, of the Claimed Amount (such agreed portion, the “Agreed Amount”) is owed to the Indemnitee; or (iii) indicates that no part of the Claimed Amount is owed to the Indemnitee. If the Response Notice is delivered in accordance with clause (ii) or (iii) of the preceding sentence, the Response Notice shall also contain a brief description of the facts and circumstances supporting the Sellers’ Representative’s claim that only a portion or no part of the Claimed Amount is owed to the Indemnitee, as the case may be. Any part of the Claimed Amount that is not agreed to be owed to the Indemnitee pursuant to the Response Notice (or the entire Claimed Amount, if the Sellers’ Representative asserts in the Response Notice that no part of the Claimed Amount is owed to the Indemnitee) is referred to in this Agreement as the “Contested Amount” (it being understood that the Contested Amount shall be modified from time to time to reflect any good faith modifications by the Indemnitee to the Claimed Amount). If no Response Notice is delivered prior to the expiration of the Dispute Period, then the Sellers shall be conclusively deemed to have agreed that the full Claimed Amount is owed to the Indemnitee.
(c) If: (i) the Sellers’ Representative delivers a liability Response Notice agreeing that the full Claimed Amount is owed to the Indemnitee; or (ii) the Sellers’ Representative does not deliver a Response Notice during the Dispute Period, then, within three (3) Business Days following the receipt of such Response Notice by the Effective Time Holders under this Section 9, and Parent may claim from the Escrow Amount Indemnitee (or, to the extent funds remain in the Indemnity Escrow Account, by the Escrow Agent) or within three (3) Business Days after the expiration of the Dispute Period, as the case may be: (A) to the extent funds remain in the Indemnity Escrow Account, the Escrow Agent shall release to the applicable Indemnitee from the Indemnity Escrow Account an amount in cash equal to the full Claimed Amount (or such lesser amount as may remain in the Indemnity Escrow Account); provided, however, that to the extent the funds in the Indemnity Escrow Account are insufficient to cover the Claimed Amount, the Sellers’ Representative shall provide written notice thereof to each Seller, and each Seller shall pay to the applicable Indemnitee, within three (3) Business Days following the receipt by such Seller of such written notice, such Seller’s Pro Rata Share of the amount by which the Claimed Amount exceeds the remaining funds in the Indemnity Escrow Account; or (B) to the extent no funds remain in the Indemnity Escrow Account, each Seller shall pay to the applicable Indemnitee such Seller’s Pro Rata Share of the full Claimed Amount.
(d) If the Sellers’ Representative delivers a Response Notice during the Dispute Period agreeing that less than the full Claimed Amount is owed to the Indemnitee, then within three (3) Business Days following the receipt of such Response Notice by the Indemnitee (or, to the extent funds remain in the Indemnity Escrow Account, by the Escrow Agent): (i) to the extent funds remain in the Indemnity Escrow Account, the Escrow Agent shall release to the applicable Indemnitee from the Indemnity Escrow Account an amount in cash equal to the Agreed Amount (or such lesser amount as may remain in the Indemnity Escrow Account); provided, however, that to the extent the funds in the Indemnity Escrow Account are insufficient to cover the amount Agreed Amount, the Sellers’ Representative shall provide written notice thereof to each Seller, and each Seller shall pay to the applicable Indemnitee, within three (3) Business Days following the receipt by such Seller of such claim and written notice, such claim is not subject Seller’s Pro Rata Share of the amount by which the Agreed Amount exceeds the remaining funds in the Indemnity Escrow Account; or (ii) to the limitations extent no funds remain in the Indemnity Escrow Account, each Seller shall pay to the applicable Indemnitee such Seller’s Pro Rata Share of the Agreed Amount.
(e) If the Sellers’ Representative delivers a Response Notice during the Dispute Period indicating that there is a Contested Amount, the Sellers’ Representative and the Indemnitee shall attempt in good faith to resolve the dispute related to the Contested Amount. If the Indemnitee and the Sellers’ Representative resolve such dispute, a settlement agreement stipulating the amount owed to the Indemnitee (the “Stipulated Amount”) shall be signed by the Indemnitee and the Sellers’ Representative. Within three (3) Business Days following the execution of such settlement agreement (or such shorter period of time as may be set forth in the settlement agreement): (i) to the extent funds remain in the Indemnity Escrow Account, the Sellers’ Representative and Purchaser shall deliver joint written instructions to the Escrow Agent instructing the Escrow Agent to release to the applicable Indemnitee from the Indemnity Escrow Account an amount in cash equal to the Stipulated Amount (or such lesser amount as may remain in the Indemnity Escrow Account); provided, however, that to the extent the funds in the Indemnity Escrow Account are insufficient to cover the Stipulated Amount, the Sellers’ Representative shall provide written notice thereof to each Seller, and each Seller shall pay to the applicable Indemnitee, within three (3) Business Days following the receipt by such Seller of such written notice, such Seller’s Pro Rata Share of the amount by which the Stipulated Amount exceeds the remaining funds in the Indemnity Escrow Account; or (ii) to the extent no funds remain in the Indemnity Escrow Account, each Seller shall pay to the applicable Indemnitee such Seller’s Pro Rata Share of the Stipulated Amount.
(f) In the event that there is a dispute relating to any Notice of Claim or any Contested Amount (whether it is a matter between any Indemnitee, on the one hand, and the Sellers, on the other hand, or it is a matter that is subject to a Third Party Claim brought against any Indemnitee) that remains unresolved after application of the terms of this Section 9.3(c) 9.6, such dispute shall be settled in accordance with Section 9.3(d), the Effective Time Holders shall pay the amount of such liability to the Indemnitee on demand or, in the case of any notice in which the amount of the claim (or any portion of the claim) is estimated, on such later date when the amount of such claim (or such portion of such claim) becomes finally determined. In the event the Securityholders’ Agent has timely disputed the liability of the Effective Time Holders (a “Claim Objection”) with respect to such claim as provided above, as promptly as possible, such Indemnitee and the Securityholders’ Agent shall establish the merits and amount of such claim (by mutual agreement, litigation, arbitration or otherwise) and if an agreement is reached, a memorandum setting forth such agreement shall be prepared and signed by both parties and shall be furnished to the Escrow Agent. If such Indemnitee and the Securityholders’ Agent do not reach an agreement as to the merits and amount of such claim within thirty (30) days immediately after the date such Claim Objection is delivered to Parent, either Parent or the Company (or the Securityholders’ Agent after the Effective Time) may demand arbitration of the matter unless the amount of the damage or loss is at issue in pending litigation or arbitration with a third party, in which event arbitration shall not be commenced until such amount is ascertained or both parties agree to arbitration. Any arbitration requested pursuant to this Section 9.6 shall be settled by arbitration conducted by three (3) arbitrators. Parent and the Company (or the Securityholders’ Agent after the Effective Time) shall each select one (1) arbitrator, and the two (2) arbitrators so selected shall select a third arbitrator. The arbitrator shall, within ten (10) Business Days after the last day of any hearings on any motion, issue a definitive ruling on such motion. The arbitrator shall also, within twenty (20) Business Days from the last day of any hearings regarding the imposition of sanctions or the issuance of any awards, issue a definitive ruling on the imposition of any such sanctions or the issuance of any such award in such arbitration. The arbitrator shall also establish procedures designed to reduce the cost and time for discovery, while allowing the parties a reasonable opportunity, adequate in the sole judgment of the arbitrator, to discover relevant information from the opposing parties about the subject matter of the dispute. The arbitrator shall rule upon motions to compel or limit discovery and shall have the authority to impose sanctions, including attorneys’ fees and costs, to the same extent as a court of competent law or equity, should the arbitrator determine that discovery was sought without substantial justification or that discovery was refused or objected to without substantial justification. The decision of the arbitrator, or a majority of the three (3) arbitrators, as applicable, shall be binding and conclusive upon the parties to this Agreement, and the Escrow Agent shall be entitled to act in accordance with such decision and make or withhold payments out of the Escrow Fund in accordance therewith. Such decision shall be written and shall be supported by written findings of fact and conclusions, which shall set forth the award, judgment, decree or order awarded by the arbitrator. Judgment upon any award rendered by the arbitrator may be entered in any court having jurisdiction. Any such arbitration shall be held in Wilmington, Delaware, under the rules then in effect of the American Arbitration Association11.11 hereof.
Appears in 1 contract
Indemnification Claim Procedure. (a) If any Indemnitee has or reasonably believes it has claims in good faith to have incurred or suffered, or reasonably believes in good faith that it is reasonably likely to may incur or suffer, Damages for which it is or will may be entitled to be held harmless, indemnified, compensated or reimbursed under Section 9 this Article 8 or for which it is or will may be entitled to a monetary remedy (such as in the case of a claim based on Fraudulent breach of a representation fraud or warranty herein intentional misrepresentation by or on behalf of the CompanySeller), such Indemnitee may deliver a notice of claim (a “Notice of Claim”) to Seller and, to the Securityholders’ extent funds remain in the Escrow Account, to the Escrow Agent. Each Notice of Claim shall shall: (i) state that such Indemnitee believes in good faith that such Indemnitee is or may be entitled to indemnification, compensation or reimbursement under this Article 8 or is or may otherwise be entitled to a monetary remedy; (ii) contain a brief description of the basis for such claim facts and each Indemnitee shall make available to circumstances supporting the Securityholders’ Agent any documents and materials in such Indemnitee’s possession or control supporting claim; and (iii) contain a good faith, non-binding, preliminary estimate of the claims set forth in aggregate amount of the Notice of Claim. In the event the Securityholders’ Agent does not notify actual and potential Damages that the Indemnitee within believes [*****] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS. have arisen and may arise as a result of such facts and circumstances (the aggregate amount of such estimate, as it may be modified by such Indemnitee in good faith from time to time, being referred to as the “Claimed Amount”).
(b) During the thirty (30) days following its receipt 30)-day period commencing upon delivery by an Indemnitee to Seller of a Notice of Claim that (the Securityholders’ Agent (on behalf of the Effective Time Holders) disputes the liability of the Effective Time Holders “Dispute Period”), Seller may deliver to the Indemnitee under this Section 9 or who delivered the amount thereof, the claim specified in such Notice of Claim and, to the extent funds remain in the Escrow Account, to the Escrow Agent a written response (the “Response Notice”) in which Seller: (i) agrees that the full Claimed Amount is owed to the Indemnitee; (ii) agrees that part, but not all, of the Claimed Amount (such agreed portion, the “Agreed Amount”) is owed to the Indemnitee; or (iii) indicates that no part of the Claimed Amount is owed to the Indemnitee. If the Response Notice is delivered in accordance with clause (ii) or (iii) of the preceding sentence, the Response Notice shall also contain a brief description of the facts and circumstances supporting Seller’s claim that only a portion or no part of the Claimed Amount is owed to the Indemnitee, as the case may be. Any part of the Claimed Amount that is not agreed to be owed to the Indemnitee pursuant to the Response Notice (or the entire Claimed Amount, if Seller asserts in the Response Notice that no part of the Claimed Amount is owed to the Indemnitee) is referred to in this Agreement as the “Contested Amount” (it being understood that the Contested Amount shall be modified from time to time to reflect any good faith modifications by the Indemnitee to the Claimed Amount). If no Response Notice is delivered prior to the expiration of the Dispute Period, then Seller shall be conclusively deemed to have agreed that the full Claimed Amount is owed to the Indemnitee.
(c) If: (i) Seller delivers a liability Response Notice agreeing that the full Claimed Amount is owed to the Indemnitee; or (ii) Seller does not deliver a Response Notice during the Dispute Period, then, within three (3) Business Days following the receipt of such Response Notice by the Effective Time Holders under this Section 9, and Parent may claim from the Escrow Amount Indemnitee (or, to the extent funds remain in the Escrow Account, by the Escrow Agent) or within three (3) Business Days after the expiration of the Dispute Period, as the case may be: (A) to the extent funds remain in the Escrow Account, the Escrow Agent shall release to the applicable Indemnitee from the Escrow Account an amount in cash equal to the full Claimed Amount (or such lesser amount as may remain in the Escrow Account)); provided, however, that to the extent the funds in the Escrow Account are insufficient to cover the Claimed Amount, Seller shall, subject in all respects to Section 8.8, promptly pay to the applicable Indemnitee the amount by which the Claimed Amount exceeds the remaining funds in the Escrow Account; or (B) to the extent no funds remain in the Escrow Account, Seller shall, subject in all respects to Section 8.8, promptly pay to the applicable Indemnitee an amount in cash equal to the full Claimed Amount.
(d) If Seller delivers a Response Notice during the Dispute Period agreeing that less than the full Claimed Amount is owed to the Indemnitee, then within three (3) Business Days following the receipt of such Response Notice: (i) to the extent funds remain in the Escrow Account, the Escrow Agent shall release to the applicable Indemnitee from the Escrow Account an amount in cash equal to the Agreed Amount (or such lesser amount as may remain in the Escrow Account)); provided, however, that to the extent the funds in the Escrow Account are insufficient to cover the Agreed Amount, Seller shall, subject in all respects to Section 8.8 promptly pay to the applicable Indemnitee the amount by which the Agreed Amount exceeds the remaining funds in the Escrow Account; or (ii) to the extent no funds remain in the Escrow Account, Seller shall, subject in all respects to Section 8.8, promptly pay to the applicable Indemnitee an amount in cash equal to the Agreed Amount.
(e) If Seller delivers a Response Notice during the Dispute Period indicating that there is a Contested Amount, Seller and the Indemnitee shall attempt in good faith to resolve the dispute related to the Contested Amount. If the Indemnitee and Seller resolve such dispute, a settlement agreement stipulating the amount owed to the Indemnitee (the “Stipulated Amount”) shall be signed by the Indemnitee and Seller. [*****] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS. Within three (3) Business Days following the execution of such claim and settlement agreement (or such claim is not subject to the limitations shorter period of time as may be set forth in the settlement agreement): (i) to the extent funds remain in the Escrow Account, Seller and Buyer shall deliver joint written instructions to the Escrow Agent instructing the Escrow Agent to release to the applicable Indemnitee from the Escrow Account an amount in cash equal to the Stipulated Amount (or such lesser amount as may remain in the Escrow Account)); provided, however, that to the extent the funds in the Escrow Account are insufficient to cover the Stipulated Amount, Seller shall, subject in all respects to Section 9.3(c8.8, promptly pay to the applicable Indemnitee the amount by which the Stipulated Amount exceeds the remaining funds in the Escrow Account; or (ii) to the extent no funds remain in the Escrow Account, Seller shall, subject in all respects to Section 8.8, promptly pay to the applicable Indemnitee an amount in cash equal to the Stipulated Amount.
(f) In the event that there is a dispute relating to any Notice of Claim or any Contested Amount (whether it is a matter between any Indemnitee, on the one hand, and Seller, on the other hand, or it is a matter that is subject to a Third Party Claim brought against any Indemnitee), that remains unresolved after application of the terms of this Section 8.6, such dispute shall be settled in accordance with Section 9.3(d), the Effective Time Holders shall pay the amount of such liability to the Indemnitee on demand or, in the case of any notice in which the amount of the claim (or any portion of the claim) is estimated, on such later date when the amount of such claim (or such portion of such claim) becomes finally determined. In the event the Securityholders’ Agent has timely disputed the liability of the Effective Time Holders (a “Claim Objection”) with respect to such claim as provided above, as promptly as possible, such Indemnitee and the Securityholders’ Agent shall establish the merits and amount of such claim (by mutual agreement, litigation, arbitration or otherwise) and if an agreement is reached, a memorandum setting forth such agreement shall be prepared and signed by both parties and shall be furnished to the Escrow Agent. If such Indemnitee and the Securityholders’ Agent do not reach an agreement as to the merits and amount of such claim within thirty (30) days immediately after the date such Claim Objection is delivered to Parent, either Parent or the Company (or the Securityholders’ Agent after the Effective Time) may demand arbitration of the matter unless the amount of the damage or loss is at issue in pending litigation or arbitration with a third party, in which event arbitration shall not be commenced until such amount is ascertained or both parties agree to arbitration. Any arbitration requested pursuant to this Section 9.6 shall be settled by arbitration conducted by three (3) arbitrators. Parent and the Company (or the Securityholders’ Agent after the Effective Time) shall each select one (1) arbitrator, and the two (2) arbitrators so selected shall select a third arbitrator. The arbitrator shall, within ten (10) Business Days after the last day of any hearings on any motion, issue a definitive ruling on such motion. The arbitrator shall also, within twenty (20) Business Days from the last day of any hearings regarding the imposition of sanctions or the issuance of any awards, issue a definitive ruling on the imposition of any such sanctions or the issuance of any such award in such arbitration. The arbitrator shall also establish procedures designed to reduce the cost and time for discovery, while allowing the parties a reasonable opportunity, adequate in the sole judgment of the arbitrator, to discover relevant information from the opposing parties about the subject matter of the dispute. The arbitrator shall rule upon motions to compel or limit discovery and shall have the authority to impose sanctions, including attorneys’ fees and costs, to the same extent as a court of competent law or equity, should the arbitrator determine that discovery was sought without substantial justification or that discovery was refused or objected to without substantial justification. The decision of the arbitrator, or a majority of the three (3) arbitrators, as applicable, shall be binding and conclusive upon the parties to this Agreement, and the Escrow Agent shall be entitled to act in accordance with such decision and make or withhold payments out of the Escrow Fund in accordance therewith. Such decision shall be written and shall be supported by written findings of fact and conclusions, which shall set forth the award, judgment, decree or order awarded by the arbitrator. Judgment upon any award rendered by the arbitrator may be entered in any court having jurisdiction. Any such arbitration shall be held in Wilmington, Delaware, under the rules then in effect of the American Arbitration Association8.7 hereof.
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Indemnification Claim Procedure. If any Indemnitee has or reasonably believes it has incurred or suffered(a) In order to seek indemnification under this ARTICLE VII (other than with respect to Third Party Claims), or reasonably believes that it is reasonably likely to incur or suffer, Damages for which it is or will be a party entitled to be held harmless, indemnified, compensated or reimbursed indemnification under Section 9 7.2 or for which it is or will be entitled Section 7.3 (an "Indemnified Party") shall deliver a written demand (an "Indemnification Demand") to a monetary remedy Seller (such as in the case of Indemnification Demands from Buyer) or Buyer (in the case of Indemnification Demands from Seller) which contains (i) a claim based on Fraudulent breach description of and if reasonably determinable at the time such demand is delivered, the amount of any Damages incurred or reasonably expected to be incurred by the Indemnified Party (the "Asserted Damages Amount"), (ii) a representation or warranty herein by or on behalf statement that the Indemnified Party may be entitled to indemnification under this ARTICLE VII for such Damages and a reasonable explanation of the Companybasis therefor, and (iii) a demand for indemnification hereunder and payment of all such Damages.
(b) Within 30 days after delivery of an Indemnification Demand to Seller or Buyer (as the case may be), such Indemnitee may party shall deliver a notice of claim (a “Notice of Claim”) to the Securityholders’ Agent. Each Notice other of Claim such parties a written response (the "Response") in which the party providing the Response shall state either: (i) agree that the basis for such claim and each Indemnitee Indemnified Party is entitled to receive all of the Asserted Damages Amount, if any (in which case, if the Indemnified Party is (A) Buyer, then, unless Seller shall make available to the Securityholders’ Agent any documents and materials in such Indemnitee’s possession or control supporting the claims set forth have elected in the Notice of Claim. In Response to pay the event the Securityholders’ Agent does not notify the Indemnitee Asserted Damages Amount to Buyer in cash in accordance with a payment method reasonable acceptable to Buyer and such payment is actually made by Seller to Buyer in full and in cash within thirty (30) days following its receipt of a Notice of Claim that the Securityholders’ Agent (on behalf five Business Days of the Effective Time Holderslater of (a) disputes the liability date Buyer receives such Response or (b) the date the amount of the Effective Time Holders Asserted Damages Amount is determined, Buyer shall be entitled to retain as an offset, without any further action by Seller, a portion (up to all) of the Indemnitee under this Section 9 Closing Shares or the amount Earnout Consideration equal to such Asserted Damages Amount in satisfaction thereof, the claim specified in and such Notice of Claim offset shall be conclusively deemed a liability to occur automatically such as to reduce the Closing Shares otherwise deliverable to Seller upon the expiration of the Effective Time Holders under this Section 9Holdback Period (and any extended period required to resolve any timely made claims for indemnification) or the Earnout Consideration, if any, and Parent may claim Seller shall, in accordance with a payment method reasonably acceptable to Buyer, pay to Buyer cash equal to any remainder of such Asserted Damages Amount not offset from the Escrow Amount orClosing Shares or the Earnout Consideration, if any, or (B) Seller, then Buyer shall, in accordance with a payment method reasonably acceptable to the extent the remaining funds in the Escrow Amount are insufficient Seller, pay to cover Seller cash equal to the amount of such claim and such claim is not Asserted Damages Amount (in either case, subject to the limitations set forth of Section 7.6)); (ii) agree that the Indemnified Party is entitled to receive part, but not all, of the Asserted Damages Amount (such portion, the "Agreed Portion") (in Section 9.3(cwhich case, if the Indemnified Party is (A) Buyer, then, unless Seller shall have elected in the Response to pay the Agreed Portion to Buyer in cash in accordance with Section 9.3(d)a payment method reasonable acceptable to Buyer and such payment is actually made by Seller to Buyer in full and in cash within five Business Days of the later of (a) the date Buyer receives such Response or (b) the date the amount of the Agreed Portion is determined, Buyer shall be entitled to retain as an offset, without any further action by Seller, a portion (up to all) of the Effective Time Holders Closing Shares or the Earnout Consideration equal to the Agreed Portion in satisfaction thereof, and such offset shall be deemed to occur automatically such as to reduce the Closing Shares otherwise deliverable to Seller upon the expiration of the Holdback Period (and any extended period required to resolve any timely made claims for indemnification) or the Earnout Consideration, if any, and Seller shall, in accordance with a payment method reasonably acceptable to Buyer, pay to Buyer cash equal to any remainder of such Agreed Portion not offset from the Closing Shares or the Earnout Consideration, if any, or (B) Seller, then Buyer shall, in accordance with a payment method reasonably acceptable to Seller, pay to Seller cash equal to the amount of such liability Agreed Portion (in either case, subject to the Indemnitee on demand orlimitations of Section 7.6)); or (iii) dispute that the Indemnified Party is entitled to receive any of the Asserted Damages Amount. Upon any cash payment by Seller to Buyer of the Asserted Dollar Amount or Agreed Portion, in Buyer shall no longer be entitled to offset the case of any notice in which Closing Shares and Earnout Consideration by the amount of such payment and shall release to Seller a portion of the claim Closing Shares, if any, then held in the Holdback Account equal to the amount of such payment divided by the Deemed Share Value.
(c) In the event that the party providing a Response shall (i) dispute that the Indemnified Party is entitled to receive any of the Asserted Damages Amount, or (ii) agree that the Indemnified Party is entitled to only an Agreed Portion of the Asserted Damages Amount, Buyer and Seller shall attempt in good faith to agree upon the rights of the respective parties with respect to each of the indemnification claims that comprise the Asserted Damages Amount (or the portion of the Asserted Damages Amount not comprising the Agreed Portion). If Buyer and Seller should so agree, then Buyer, unless Buyer and Seller shall have entered into a written agreement pursuant to which Seller unconditionally agrees to pay to Buyer such amount of Damages upon which Buyer and Seller agree (as applicable) in cash in accordance with a payment method reasonable acceptable to Buyer and such payment is actually made by Seller to Buyer in full and in cash within five Business Days of the later of (a) the date such written agreement is entered into or (b) the date the agreed upon amount of Damages is determined, shall be entitled to retain as an offset, without any further action by Seller, a portion (up to all) of the Closing Shares or the Earnout Consideration equal to such amount of Damages upon which Buyer and Seller agree (as applicable) in satisfaction thereof, and such offset shall be deemed to occur automatically such as to reduce the Closing Shares otherwise deliverable to Seller upon the expiration of the Holdback Period (and any extended period required to resolve any timely made claims for indemnification) or the Earnout Consideration, if any, and Seller shall, in accordance with a payment method reasonably acceptable to Buyer, pay to Buyer cash equal to any remainder of such Damages not offset from the Closing Shares or the Earnout Consideration, if any. If no such agreement can be reached after good faith negotiation within 15 days after delivery of a Response, then, at the request of either party, the parties shall submit the dispute to a mutually acceptable arbitrator in San Diego County, California designated by the American Arbitration Association, under its rules for Commercial Arbitration, for binding and final resolution. If such arbitrator determines that Buyer is entitled to any portion of the claimAsserted Damages Amount in dispute (or the portion of the Asserted Damages Amount not comprising the Agreed Portion in dispute), then Buyer, unless Seller shall have paid to Buyer in full and in cash within five Business Days of the later of (a) is estimated, on the date such later determination or (b) the date when the amount of such claim (or such portion of such claim) becomes finally Damages is determined. In the event the Securityholders’ Agent has timely disputed the liability of the Effective Time Holders (a “Claim Objection”) with respect to such claim as provided above, as promptly as possible, such Indemnitee and the Securityholders’ Agent shall establish the merits and amount of such claim (by mutual agreement, litigation, arbitration or otherwise) and if an agreement is reached, a memorandum setting forth such agreement shall be prepared and signed by both parties and shall be furnished to the Escrow Agent. If such Indemnitee and the Securityholders’ Agent do not reach an agreement as to the merits and amount of such claim within thirty (30) days immediately after the date such Claim Objection is delivered to Parent, either Parent or the Company (or the Securityholders’ Agent after the Effective Time) may demand arbitration of the matter unless the amount of the damage or loss is at issue in pending litigation or arbitration accordance with a third partypayment method reasonable acceptable to Buyer the entire amount to which Buyer is entitled, in which event arbitration shall not be commenced until such amount is ascertained or both parties agree to arbitration. Any arbitration requested pursuant to this Section 9.6 shall be settled by arbitration conducted by three (3) arbitrators. Parent and the Company (or the Securityholders’ Agent after the Effective Time) shall each select one (1) arbitrator, and the two (2) arbitrators so selected shall select a third arbitrator. The arbitrator shall, within ten (10) Business Days after the last day of any hearings on any motion, issue a definitive ruling on such motion. The arbitrator shall also, within twenty (20) Business Days from the last day of any hearings regarding the imposition of sanctions or the issuance of any awards, issue a definitive ruling on the imposition of any such sanctions or the issuance of any such award in such arbitration. The arbitrator shall also establish procedures designed to reduce the cost and time for discovery, while allowing the parties a reasonable opportunity, adequate in the sole judgment of the arbitrator, to discover relevant information from the opposing parties about the subject matter of the dispute. The arbitrator shall rule upon motions to compel or limit discovery and shall have the authority to impose sanctions, including attorneys’ fees and costs, to the same extent as a court of competent law or equity, should the arbitrator determine that discovery was sought without substantial justification or that discovery was refused or objected to without substantial justification. The decision of the arbitrator, or a majority of the three (3) arbitrators, as applicable, shall be binding and conclusive upon the parties to this Agreement, and the Escrow Agent shall be entitled to act in accordance with such decision and make or withhold payments out retain as an offset, without any further action by Seller, a portion (up to all) of the Escrow Fund Closing Shares or the Earnout Consideration equal to such amount of Damages to which Buyer and is entitled as determined by the arbitrator in accordance therewith. Such decision satisfaction thereof, and such offset shall be written deemed to occur automatically such as to reduce the Closing Shares otherwise deliverable to Seller upon the expiration of the Holdback Period (and any extended period required to resolve any timely made claims for indemnification) or the Earnout Consideration, if any. The fees and expenses of the arbitration shall be supported by written findings of fact and conclusions, which shall set forth the award, judgment, decree or order awarded paid as determined by the arbitrator. Judgment upon any award rendered by the arbitrator may be entered in any court having jurisdiction. Any such arbitration shall be held in Wilmington, Delaware, under the rules then in effect of the American Arbitration Association.
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Indemnification Claim Procedure. If any Indemnitee has or reasonably believes it has incurred or suffered, or reasonably believes that it is reasonably likely to incur or suffer, Damages for which it is or will be entitled to be held harmless, indemnified, compensated or reimbursed under Section 9 or for which it is or will be entitled to a monetary remedy (such as in the case of a claim based on Fraudulent breach of a representation or warranty herein by or on behalf of the Company), such Indemnitee may deliver a notice of claim (a “Notice of Claim”a) to the Securityholders’ Agent. Each Notice of Claim shall state the basis for such claim and each Indemnitee shall make available to the Securityholders’ Agent any documents and materials in such Indemnitee’s possession or control supporting the claims set forth in the Notice of Claim. In the event the Securityholders’ Agent does not notify the Indemnitee within thirty (30) days following its receipt of a Notice of Claim that the Securityholders’ Agent (on behalf of the Effective Time Holders) disputes the liability of the Effective Time Holders to the Indemnitee under this Section 9 or the amount thereof, the claim specified in such Notice of Claim shall be conclusively deemed a liability of the Effective Time Holders under this Section 9, and Parent may claim from the Escrow Amount or, to the extent the remaining funds in the Escrow Amount are insufficient to cover the amount of such claim and such claim is not subject Subject to the limitations set forth in Section 9.3(c7.04, if an Indemnified Party wishes to make an indemnification claim under this Article VII, the Representative appointed by such Indemnified Party (the “Indemnified Party Representative”) shall deliver a written notice (an “Indemnification Claim Notice”) to the Representative appointed by the Indemnifying Party (the “Indemnifying Party Representative”) (i) stating that an Indemnified Party has paid, incurred, suffered or sustained, or reasonably anticipates that it may pay, incur, suffer or sustain Damages, and (ii) specifying in reasonable detail the individual items of such Damages, the date each such item was paid, incurred, suffered or sustained (to the extent known), or the basis for such anticipated liability, and, the nature of the misrepresentation, breach of warranty or covenant to which such item is related. The Indemnified Party Representative may update an Indemnification Claim Notice from time to time to reflect any new information discovered with respect to the claim set forth in such Indemnification Claim Notice.
(b) If the Indemnifying Party Representative shall not object in writing within the thirty (30) day period after receipt of an Indemnification Claim Notice by delivery to the Indemnified Party Representative of a written notice of objection containing a reasonably detailed description of the facts and circumstances supporting an objection to the applicable indemnification claim (an “Indemnification Claim Objection Notice”), such failure to so object shall be an irrevocable acknowledgment by the Indemnifying Party Representative that the Indemnified Party is entitled to the full amount of the claim for Damages set forth in such Indemnification Claim Notice.
(c) In such event, Eliem shall promptly release and retain from the Holdback Shares (and the rights to such retained Holdback Shares will be permanently forfeited by the Escrow Holders), or issue new shares of Eliem Common Stock to the Athenen Indemnified Parties, as applicable, in the amount of Damages set forth in such Indemnification Claim Notice. Should the Holdback Shares be insufficient to satisfy in whole the amount to be paid to an Eliem Indemnified Party by the Athenen Indemnifying Parties in accordance with such Indemnification Claim Notice, then each Athenen Indemnifying Party shall, within ten (10) business days following the expiration date of the right of the Indemnifying Party Representative to make an Indemnification Claim Objection Notice, pay to the Eliem Indemnified Party, such Athenen Indemnifying Parties’ Pro Rata Share of such shortfall (subject to the applicable liability limitations herein), such payment to be made in the form of shares of Eliem Common Stock and Eliem Series A Preferred Stock.
(d) In the event that the Indemnifying Party Representative shall deliver an Indemnification Claim Objection Notice in accordance with Section 9.3(d)7.05(b) within thirty (30) days after delivery of such Indemnification Claim Notice, the Effective Time Holders Indemnifying Party Representative and the Indemnified Party Representative shall pay attempt in good faith to agree upon the amount of such liability to the Indemnitee on demand or, in the case of any notice in which the amount rights of the claim (or any portion of the claim) is estimated, on such later date when the amount of such claim (or such portion of such claim) becomes finally determined. In the event the Securityholders’ Agent has timely disputed the liability of the Effective Time Holders (a “Claim Objection”) respective parties with respect to each of such claim as provided above, as promptly as possible, such Indemnitee claims. If the Indemnifying Party Representative and the Securityholders’ Agent shall establish the merits and amount of such claim (by mutual agreement, litigation, arbitration or otherwise) and if an agreement is reachedIndemnified Party Representative should so agree, a memorandum setting forth such agreement shall be prepared and signed by both parties the Indemnifying Party Representative and the Indemnified Party Representative, and shall be furnished to Eliem. Eliem shall release and retain Holdback Shares (and the rights to such retained Holdback Shares will be permanently forfeited by the Escrow AgentHolders), or issue new shares of Eliem Common Stock, as applicable, in accordance with the terms of such memorandum. If Should the Holdback Shares be insufficient to satisfy in whole the amount owed to an Eliem Indemnified Party in accordance with such Indemnitee memorandum and this Agreement, then each Athenen Indemnifying Party shall, within ten (10) business days following the Securityholders’ Agent do not reach an agreement as date of such memorandum, pay to the merits and amount Eliem Indemnified Party such Indemnifying Party’s Pro Rata Share of such claim within shortfall (subject to the applicable liability limitations herein), such payment to be made in the form of shares of Eliem Common Stock and Eliem Series A Preferred Stock.
(e) If no such agreement can be reached after good faith negotiation and prior to thirty (30) days immediately after the date such delivery of an Indemnification Claim Objection is delivered to ParentNotice, either Parent the Indemnifying Party Representative or the Company (or Indemnified Party Representative may commence litigation to resolve the Securityholders’ Agent after the Effective Time) may demand arbitration of the matter matter, unless the amount of the damage or loss Damages that is at issue in is the subject of a pending litigation or arbitration with a third party, in which event arbitration litigation shall not be commenced until such amount is ascertained or both parties agree to arbitration. Any arbitration requested pursuant to this Section 9.6 litigation, and in either such event the matter shall be settled by arbitration litigation conducted by three pursuant to Section 9.05.
(3f) arbitrators. Parent Eliem shall release and retain Holdback Shares (and the Company (rights to any retained Holdback Shares will be permanently forfeited by the Escrow Holders), or shall issue new shares of Eliem Common Stock, as applicable, in accordance with, the Securityholders’ Agent after terms of any such award, judgment, decree or order of the Effective Time) shall court(s), as applicable. Should the Holdback Shares be insufficient to satisfy in whole the amount owed to an Eliem Indemnified Party in accordance with such decision and this Agreement, then each select one (1) arbitrator, and the two (2) arbitrators so selected shall select a third arbitrator. The arbitrator Athenen Indemnifying Party shall, within ten (10) Business Days after business days following the last day date of such decision, pay to the Eliem Indemnified Party such Indemnifying Party’s Pro Rata Share of such shortfall (subject to the applicable liability limitations herein, such payment to be made in the form of shares of Eliem Common Stock and Eliem Series A Preferred Stock).
(g) For all purposes of this Article VII, (i) for purposes of any hearings on claims or recovery by the Eliem Indemnified Parties: (A) any motion, issue a definitive ruling on such motion. The arbitrator shares of Eliem Common Stock held within the Holdback Shares or otherwise paid as any portion of the Merger consideration shall also, within twenty be valued at $2.40 per share and (20B) Business Days from any shares of Eliem Series A Preferred Stock paid as any portion of the last day Merger consideration shall be valued at $3.00 per share and (ii) for purposes of any hearings regarding claims or recovery by the imposition Athenen Indemnified Parties, any shares of sanctions or the issuance of any awards, issue a definitive ruling on the imposition of any Eliem Common Stock to be issued to such sanctions or the issuance of any such award in such arbitration. The arbitrator shall also establish procedures designed to reduce the cost and time for discovery, while allowing the parties a reasonable opportunity, adequate in the sole judgment of the arbitrator, to discover relevant information from the opposing parties about the subject matter of the dispute. The arbitrator shall rule upon motions to compel or limit discovery and shall have the authority to impose sanctions, including attorneys’ fees and costs, to the same extent as a court of competent law or equity, should the arbitrator determine that discovery was sought without substantial justification or that discovery was refused or objected to without substantial justification. The decision of the arbitrator, or a majority of the three (3) arbitrators, as applicable, Athenen Indemnified Parties shall be binding and conclusive upon the parties to this Agreement, and the Escrow Agent shall be entitled to act in accordance with such decision and make or withhold payments out of the Escrow Fund in accordance therewith. Such decision shall be written and shall be supported by written findings of fact and conclusions, which shall set forth the award, judgment, decree or order awarded by the arbitrator. Judgment upon any award rendered by the arbitrator may be entered in any court having jurisdiction. Any such arbitration shall be held in Wilmington, Delaware, under the rules then in effect of the American Arbitration Associationvalued at $2.40 per share.
Appears in 1 contract
Indemnification Claim Procedure. (a) If any Indemnitee has or reasonably believes it has claims in good faith to have incurred or suffered, or reasonably believes in good faith that it is reasonably likely to may incur or suffer, Damages for which it is or will may be entitled to be held harmless, indemnified, compensated or reimbursed under Section 9 Article X or for which it is or will may be entitled to a monetary remedy (such as in the case of a claim based on Fraudulent breach of a representation or warranty herein by or on behalf of the Companyfraud), such Indemnitee may deliver a notice of claim (a “Notice of Claim”) to the Securityholders’ AgentCompany Stockholder; provided, however, that the failure timely to give a Notice of Claim shall affect the rights of an Indemnitee hereunder only to the extent that such failure has a materially prejudicial effect on the defenses or other rights available to the Indemnitee. Each Notice of Claim shall shall: (i) state that such Indemnitee believes in good faith that such Indemnitee is or may be entitled to indemnification, compensation or reimbursement under Article X or is or may otherwise be entitled to a monetary remedy; (ii) contain a brief description of the basis for facts and circumstances supporting the Indemnitee’s claim; and (iii) if practicable, contain a good faith, non-binding, preliminary estimate of the aggregate amount of the actual and potential Damages that the Indemnitee believes have arisen and may arise as a result of such claim facts and each circumstances (the aggregate amount of such estimate, as it may be modified by such Indemnitee shall make available in good faith from time to time, being referred to as the “Claimed Amount”).
(b) During the 30-day period commencing upon delivery by an Indemnitee to the Securityholders’ Agent any documents and materials in such Indemnitee’s possession or control supporting the claims set forth in the Notice of Claim. In the event the Securityholders’ Agent does not notify the Indemnitee within thirty (30) days following its receipt Company Stockholder of a Notice of Claim that (the Securityholders’ Agent (on behalf of “Dispute Period”), the Effective Time Holders) disputes the liability of the Effective Time Holders Company Stockholder may deliver to the Indemnitee under this Section 9 or who delivered the amount thereof, the claim specified in such Notice of Claim a written response (the “Response Notice”) in which the Company Stockholder: (i) agrees that the full Claimed Amount is owed to the Indemnitee; (ii) agrees that part, but not all, of the Claimed Amount (the “Agreed Amount”) is owed to the Indemnitee; or (iii) indicates that no part of the Claimed Amount is owed to the Indemnitee. If the Response Notice is delivered in accordance with clause (ii) or (iii) of the preceding sentence, the Response Notice shall also contain a brief description of the facts and circumstances supporting the Company Stockholder’s claim that only a portion or no part of the Claimed Amount is owed to the Indemnitee, as the case may be. Any part of the Claimed Amount that is not agreed to be owed to the Indemnitee pursuant to the Response Notice (or the entire Claimed Amount, if the Company Stockholder asserts in the Response Notice that no part of the Claimed Amount is owed to the Indemnitee) is referred to in this Agreement as the “Contested Amount” (it being understood that the Contested Amount shall be modified from time to time to reflect any good faith modifications by the Indemnitee to the Claimed Amount). If a Response Notice is not received by the Indemnitee prior to the expiration of the Dispute Period, then the Company Stockholder shall be conclusively deemed a liability of to have agreed that the Effective Time Holders under this Section 9, and Parent may claim from the Escrow full Claimed Amount or, is owed to the extent the remaining funds in the Escrow Amount are insufficient to cover the amount of such claim and such claim is not subject to the limitations set forth in Section 9.3(c) in accordance with Section 9.3(d), the Effective Time Holders shall pay the amount of such liability to the Indemnitee on demand or, in the case of any notice in which the amount of the claim (or any portion of the claim) is estimated, on such later date when the amount of such claim (or such portion of such claim) becomes finally determined. In the event the Securityholders’ Agent has timely disputed the liability of the Effective Time Holders (a “Claim Objection”) with respect to such claim as provided above, as promptly as possible, such Indemnitee and the Securityholders’ Agent shall establish the merits and amount of such claim (by mutual agreement, litigation, arbitration or otherwise) and if an agreement is reached, a memorandum setting forth such agreement shall be prepared and signed by both parties and shall be furnished to the Escrow Agent. If such Indemnitee and the Securityholders’ Agent do not reach an agreement as to the merits and amount of such claim within thirty (30) days immediately after the date such Claim Objection is delivered to Parent, either Parent or the Company (or the Securityholders’ Agent after the Effective Time) may demand arbitration of the matter unless the amount of the damage or loss is at issue in pending litigation or arbitration with a third party, in which event arbitration shall not be commenced until such amount is ascertained or both parties agree to arbitration. Any arbitration requested pursuant to this Section 9.6 shall be settled by arbitration conducted by three (3) arbitrators. Parent and the Company (or the Securityholders’ Agent after the Effective Time) shall each select one (1) arbitrator, and the two (2) arbitrators so selected shall select a third arbitrator. The arbitrator shall, within ten (10) Business Days after the last day of any hearings on any motion, issue a definitive ruling on such motion. The arbitrator shall also, within twenty (20) Business Days from the last day of any hearings regarding the imposition of sanctions or the issuance of any awards, issue a definitive ruling on the imposition of any such sanctions or the issuance of any such award in such arbitration. The arbitrator shall also establish procedures designed to reduce the cost and time for discovery, while allowing the parties a reasonable opportunity, adequate in the sole judgment of the arbitrator, to discover relevant information from the opposing parties about the subject matter of the dispute. The arbitrator shall rule upon motions to compel or limit discovery and shall have the authority to impose sanctions, including attorneys’ fees and costs, to the same extent as a court of competent law or equity, should the arbitrator determine that discovery was sought without substantial justification or that discovery was refused or objected to without substantial justification. The decision of the arbitrator, or a majority of the three (3) arbitrators, as applicable, shall be binding and conclusive upon the parties to this Agreement, and the Escrow Agent shall be entitled to act in accordance with such decision and make or withhold payments out of the Escrow Fund in accordance therewith. Such decision shall be written and shall be supported by written findings of fact and conclusions, which shall set forth the award, judgment, decree or order awarded by the arbitrator. Judgment upon any award rendered by the arbitrator may be entered in any court having jurisdiction. Any such arbitration shall be held in Wilmington, Delaware, under the rules then in effect of the American Arbitration AssociationIndemnitee.
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Indemnification Claim Procedure. With respect to any claim for indemnification, compensation or reimbursement pursuant to this Section 10, such claims shall be brought and resolved exclusively as follows (other than with respect to claims pursuant to Section 10.2(a)(xii), which shall be brought and resolved as set forth on Schedule 10.2(a)(xii)):
(a) If any Indemnitee has or reasonably believes it has claims in good faith to have incurred or suffered, or reasonably believes in good faith that it is reasonably likely to may incur or suffer, Damages for which it is or will may be entitled to be held harmless, indemnified, compensated or reimbursed under Section 9 10 (other than with respect to claims pursuant to Section 10.2(a)(xii)) or for which it is or will may be entitled to a monetary remedy under Section 10 (such as including in the case of a claim based on Fraudulent breach of a representation or warranty herein by or on behalf of the CompanyFraud) (other than with respect to claims pursuant to Section 10.2(a)(xii)), such Indemnitee may shall deliver a notice of claim in writing (a “Notice of Claim”) to the Securityholders’ AgentAgent as promptly as reasonably possible after becoming aware of the basis of such claim. Each Notice of Claim shall shall: (i) state that such Indemnitee believes in good faith that such Indemnitee is or may be entitled to indemnification, compensation or reimbursement under Section 10; (ii) contain a reasonably detailed description of the basis for of such claim and each the facts and circumstances supporting such Indemnitee’s claim; and (iii) if practicable, contain a good faith, non-binding, preliminary estimate of the aggregate amount of the actual and potential Damages that the Indemnitee shall make available believes have arisen and may arise as a result of such facts and circumstances (the aggregate amount of such estimate, as it may be modified by such Indemnitee from time to time, being referred to as the “Claimed Amount”).
(b) During the 20-day period commencing upon delivery by an Indemnitee to the Securityholders’ Agent any documents and materials of a Notice of Claim (or, in such Indemnitee’s possession or control supporting the claims set forth in event that an Indemnitee delivers an updated Notice of Claim, the 20-day period commencing upon delivery by an Indemnitee after the last updated Notice of Claim) (the “Dispute Period”), the Securityholders’ Agent shall deliver to the Indemnitee who delivered the Notice of ClaimClaim a written response (the “Response Notice”) in which the Securityholders’ Agent: (i) agrees that the full Claimed Amount is owed to such Indemnitee; (ii) agrees that part, but not all, of the Claimed Amount (the “Agreed Amount”) is owed to the Indemnitee; or (iii) indicates that no part of the Claimed Amount is owed to such Indemnitee. In If the event Response Notice is delivered in accordance with clause “(ii)” or “(iii)” of the preceding sentence, such Response Notice shall also contain a reasonably detailed description of the facts and circumstances supporting the Securityholders’ Agent’s claim that only a portion or no part of the Claimed Amount is owed to the Indemnitee, as the case may be. Any part of the Claimed Amount that is not agreed to be owed to the Indemnitee pursuant to the Response Notice (or the entire Claimed Amount, if the Securityholders’ Agent asserts in the Response Notice that no part of the Claimed Amount is owed to the Indemnitee) is referred to in this Agreement as the “Contested Amount” (it being understood that the Contested Amount may be modified from time to time to reflect any modifications by the Indemnitee to the Claimed Amount). If a Response Notice is not delivered to the Indemnitee prior to the expiration of the Dispute Period, then the Securityholders’ Agent shall be conclusively deemed to have agreed that the full Claimed Amount is owed to the Indemnitee.
(c) If (i) the Securityholders’ Agent delivers a Response Notice to the Indemnitee agreeing that the full Claimed Amount is owed to the Indemnitee, or (ii) the Securityholders’ Agent does not notify deliver a Response Notice to the Indemnitee within thirty during the Dispute Period, then Parent shall have the right to deduct such Claimed Amount from the Indemnification Holdback, to the extent available.
(30d) days following its receipt of a Notice of Claim that If the Securityholders’ Agent (on behalf of the Effective Time Holders) disputes the liability of the Effective Time Holders delivers a Response Notice to the Indemnitee under this Section 9 or during the Dispute Period agreeing that less than the full Claimed Amount is owed to the Indemnitee, then Parent shall have the right to deduct such agreed upon amount thereof, the claim specified in such Notice of Claim shall be conclusively deemed a liability of the Effective Time Holders under this Section 9, and Parent may claim from the Escrow Amount or, to the extent the remaining funds in the Escrow Amount are insufficient to cover the amount of such claim and such claim is not subject to the limitations set forth in Section 9.3(cIndemnification Holdback.
(e) in accordance with Section 9.3(d), the Effective Time Holders shall pay the amount of such liability to the Indemnitee on demand or, in the case of any notice in which the amount of the claim (or any portion of the claim) is estimated, on such later date when the amount of such claim (or such portion of such claim) becomes finally determined. In the event If the Securityholders’ Agent has timely disputed delivers a Response Notice to the liability of Indemnitee during the Effective Time Holders Dispute Period indicating that there is a Contested Amount, the Securityholders’ Agent and the Indemnitee shall attempt in good faith to resolve the dispute related to the Contested Amount within 30 days after the date on which the Securityholders’ Agent delivers such Response Notice (a “Claim Objection”) with respect to or such claim longer period as provided above, as promptly as possible, such the Indemnitee and the Securityholders’ Agent shall establish the merits and amount of such claim (by mutual agreement, litigation, arbitration or otherwise) and if an agreement is reached, a memorandum setting forth such agreement shall be prepared and signed by both parties and shall be furnished to the Escrow Agentmay mutually agree in writing). If such the Indemnitee and the Securityholders’ Agent do not reach an resolve such dispute during such period, then their resolution of such dispute shall be binding on the Securityholders’ Agent, the Indemnitors and such Indemnitee and a settlement agreement as stipulating the amount owed to the merits Indemnitee (the “Stipulated Amount”) shall be signed by the Indemnitee and amount the Securityholders’ Agent. Parent shall, following the execution of such settlement agreement, deduct the Stipulated Amount from the Indemnification Holdback.
(f) Other than with respect to any claim within thirty for indemnification relating primarily to Tax matters (30) days immediately after which shall be governed by Section 10.7(g)), in the date such Claim Objection is delivered to Parent, either Parent or event that the Company (or Indemnitee and the Securityholders’ Agent fail to reach a resolution on a Notice of Claim or Contested Amount that is the subject of a Response Notice, within 30 days after the Effective Timedate on which the Securityholders’ Agent delivers such Response Notice (or such longer period as the Indemnitee and the Securityholders’ Agent may mutually agree in writing), to the extent that (i) may demand arbitration the claim subject to such Notice of Claim is between the Indemnitee, on the one hand, and the Indemnitors, on the other hand, and not a matter unless the amount of the damage that is subject to a claim or loss is at issue in pending litigation Legal Proceeding asserted or arbitration with commenced by a third partyparty brought against the Indemnitee, in which event arbitration such dispute shall not be commenced until settled pursuant to Section 11.9 and (iii) the claim subject to such amount Notice of Claim is ascertained or both parties agree to arbitration. Any arbitration requested a Third Party Claim, such dispute shall be settled pursuant to this Section 9.6 shall be settled by arbitration conducted by three (3) arbitrators. Parent and the Company (or the Securityholders’ Agent after the Effective Time) shall each select one (1) arbitrator, and the two (2) arbitrators so selected shall select a third arbitrator. The arbitrator shall, within ten (10) Business Days after the last day of any hearings on any motion, issue a definitive ruling on such motion. The arbitrator shall also, within twenty (20) Business Days from the last day of any hearings regarding the imposition of sanctions or the issuance of any awards, issue a definitive ruling on the imposition of any such sanctions or the issuance of any such award in such arbitration. The arbitrator shall also establish procedures designed to reduce the cost and time for discovery, while allowing the parties a reasonable opportunity, adequate in the sole judgment of the arbitrator, to discover relevant information from the opposing parties about the subject matter of the dispute. The arbitrator shall rule upon motions to compel or limit discovery and shall have the authority to impose sanctions, including attorneys’ fees and costs, to the same extent as a court of competent law or equity, should the arbitrator determine that discovery was sought without substantial justification or that discovery was refused or objected to without substantial justification. The decision of the arbitrator, or a majority of the three (3) arbitrators, as applicable, shall be binding and conclusive upon the parties to this Agreement, and the Escrow Agent shall be entitled to act in accordance with such decision and make or withhold payments out of the Escrow Fund in accordance therewith. Such decision shall be written and shall be supported by written findings of fact and conclusions, which shall set forth the award, judgment, decree or order awarded by the arbitrator. Judgment upon any award rendered by the arbitrator may be entered in any court having jurisdiction. Any such arbitration shall be held in Wilmington, Delaware, under the rules then in effect of the American Arbitration Association10.7.
Appears in 1 contract
Samples: Merger Agreement (RealPage, Inc.)
Indemnification Claim Procedure. Any claim for indemnification, compensation or reimbursement pursuant to this Article XI shall be brought and resolved exclusively as follows:
(a) If any Indemnitee has or reasonably believes it has claims in good faith to have actually incurred or suffered, or reasonably believes in good faith that it is reasonably likely to may actually incur or suffer, Damages Losses (whether or not arising from the assertion or commencement by any Person (other than an Indemnitee) of any Proceeding) for which it is or will may be entitled to be held harmless, indemnified, compensated harmless or reimbursed indemnified under Section 9 or for which it is or will be entitled to a monetary remedy Article XI (such as including in the case of a claim based on Fraudulent breach of a representation or warranty herein by or on behalf of the CompanyFraud), such Indemnitee may shall deliver a written notice of claim (a “Notice of Claim”) to the Securityholders’ AgentStockholder Representative promptly, but in any event within fifteen (15) days after first becoming aware of the occurrence of the event giving rise to such Indemnitee’s claim for indemnification pursuant hereto. The failure by such Indemnitee to give such Notice of Claim to the Stockholder Representative within the period specified in the foregoing sentence shall not, however, relieve Sellers of their indemnification obligations hereunder, except to the extent that Sellers are materially and adversely prejudiced thereby. Each Notice of Claim shall shall: (i) state that such Indemnitee believes in good faith that such Indemnitee is or may be entitled to indemnification under Article XI; (ii) contain a reasonably detailed description of the basis for such claim facts and each Indemnitee shall make available to the Securityholders’ Agent any documents and materials in circumstances supporting such Indemnitee’s possession or control supporting claim; and (iii) if practicable, contain a good faith, non-binding estimate of the claims set forth in aggregate amount of the Notice of Claim. In the event the Securityholders’ Agent does not notify actual and potential Losses that the Indemnitee within thirty reasonably believes have arisen and may arise as a result of such facts and circumstances (the aggregate amount of such estimate, as it may be modified by such Indemnitee from time to time, being referred to as the “Claimed Amount”).
(b) During the 30) days following its -day period commencing upon receipt by the Stockholder Representative from an Indemnitee of a Notice of Claim that (the Securityholders’ Agent (on behalf of “Dispute Period”), the Effective Time Holders) disputes the liability of the Effective Time Holders Stockholder Representative may send to the Indemnitee under this Section 9 or who delivered the amount thereof, the claim specified in such Notice of Claim a written response (the “Response Notice”) in which the Stockholder Representative: (i) agrees that the full Claimed Amount is owed to such Indemnitee; (ii) agrees that part, but not all, of the Claimed Amount (the “Agreed Amount”) is owed to the Indemnitee; or (iii) indicates that no part of the Claimed Amount is owed to such Indemnitee. If the Response Notice is delivered in accordance with clause (ii) or (iii) of the preceding sentence, such Response Notice shall also contain a reasonably detailed description of the facts and circumstances supporting the Stockholder Representative’s claim that only a portion or no part of the Claimed Amount is owed to the Indemnitee, as the case may be. Any part of the Claimed Amount that is not agreed to be owed to the Indemnitee pursuant to the Response Notice (or the entire Claimed Amount, if the Stockholder Representative asserts in the Response Notice that no part of the Claimed Amount is owed to the Indemnitee) is referred to in this Agreement as the “Contested Amount” (it being understood that the Contested Amount shall be modified from time to time to reflect any modifications by the Indemnitee to the Claimed Amount). If a Response Notice is not sent to the Indemnitee prior to the expiration of the Dispute Period, then the Stockholder Representative shall be conclusively deemed to have agreed that the full Claimed Amount is owed to the Indemnitee.
(c) If (i) the Stockholder Representative delivers a liability Response Notice to the Indemnitee agreeing that the full Claimed Amount is owed to the Indemnitee, or (ii) the Stockholder Representative does not deliver a Response Notice to the Indemnitee during the Dispute Period, then, subject to the provisions of Section 11.03:
(i) with respect to a claim for indemnification pursuant to Section 11.02(a), the Effective Time Holders obligation to pay the Claimed Amount to the Indemnitee shall be satisfied (A) first, by application toward the Threshold Amount, (B) second, by Sellers to the extent recovery is available under this Section 9the Escrow Fund, pursuant to the Escrow Agreement, up to the Cap, and Parent may (C) thereafter, by recovery under the R&W Insurance Policy; and
(ii) with respect to any other claim from for indemnification, compensation or reimbursement pursuant to this Article XI, the Escrow obligation to pay the Claimed Amount orto the Indemnitee shall be satisfied by Sellers as follows: (A) first, to the extent the remaining funds in recovery is available under the Escrow Amount are insufficient to cover the amount of such claim and such claim is not subject to the limitations set forth in Section 9.3(c) in accordance with Section 9.3(d)Fund, the Effective Time Holders shall pay the amount of such liability to the Indemnitee on demand or, in the case of any notice in which the amount of the claim (or any portion of the claim) is estimated, on such later date when the amount of such claim (or such portion of such claim) becomes finally determined. In the event the Securityholders’ Agent has timely disputed the liability of the Effective Time Holders (a “Claim Objection”) with respect to such claim as provided above, as promptly as possible, such Indemnitee and the Securityholders’ Agent shall establish the merits and amount of such claim (by mutual agreement, litigation, arbitration or otherwise) and if an agreement is reached, a memorandum setting forth such agreement shall be prepared and signed by both parties and shall be furnished pursuant to the Escrow Agent. If such Indemnitee and the Securityholders’ Agent do not reach an agreement as to the merits and amount of such claim within thirty (30) days immediately after the date such Claim Objection is delivered to Parent, either Parent or the Company (or the Securityholders’ Agent after the Effective Time) may demand arbitration of the matter unless the amount of the damage or loss is at issue in pending litigation or arbitration with a third party, in which event arbitration shall not be commenced until such amount is ascertained or both parties agree to arbitration. Any arbitration requested pursuant to this Section 9.6 shall be settled by arbitration conducted by three (3) arbitrators. Parent and the Company (or the Securityholders’ Agent after the Effective Time) shall each select one (1) arbitratorAgreement, and the two (2B) arbitrators so selected shall select a third arbitrator. The arbitrator thereafter, each Seller shall, within ten (10) Business Days after the last day following such earlier date, pay such Seller’s Pro Rata Share of any hearings on remaining unpaid portion of the Claimed Amount to the Indemnitee.
(d) If the Stockholder Representative delivers a Response Notice to the Indemnitee during the Dispute Period agreeing that less than the full Claimed Amount is owed to the Indemnitee, then, subject to the provisions of Section 11.03:
(i) with respect to a claim for indemnification, compensation or reimbursement pursuant to Section 11.02(a), the obligation to pay the Agreed Amount to the Indemnitee shall be satisfied (A) first, by application toward the Threshold Amount, (B) second, by Sellers to the extent recovery is available under the Escrow Fund, pursuant to the Escrow Agreement, up to the Cap, and (C) thereafter, by recovery under the R&W Insurance Policy; and
(ii) with respect to any motionother claim for indemnification, issue a definitive ruling on such motion. The arbitrator compensation or reimbursement pursuant to this Article XI, the obligation to pay the Agreed Amount to the Indemnitee shall alsobe satisfied by Sellers as follows: (A) first, to the extent recovery is available under the Escrow Fund, pursuant to the Escrow Agreement, and (B) thereafter, each Seller shall, within twenty ten (2010) Business Days from following the last day date of such Response Notice, pay such Seller’s Pro Rata Share of any hearings regarding remaining unpaid portion of the imposition Agreed Amount to the Indemnitee.
(e) If the Stockholder Representative delivers a Response Notice to the Indemnitee during the Dispute Period indicating that there is a Contested Amount, the Stockholder Representative and the Indemnitee shall attempt in good faith to resolve the dispute related to the Contested Amount within thirty (30) days after the date on which the Stockholder Representative delivers such Response Notice (or such longer period as the Indemnitee and the Stockholder Representative may mutually agree in writing). If the Indemnitee and the Stockholder Representative resolve such dispute during such period, then their resolution of sanctions or the issuance of any awards, issue a definitive ruling such dispute shall be binding on the imposition Stockholder Representative, the Sellers and such Indemnitee and a settlement agreement stipulating the amount owed to the Indemnitee (the “Stipulated Amount”) shall be signed by the Indemnitee and the Stockholder Representative. Following the execution of such settlement agreement, subject to the provisions of Section 11.03:
(i) with respect to a claim for indemnification, compensation or pursuant to Section 11.02(a), the obligation to pay the Stipulated Amount to the Indemnitee shall be satisfied (A) first, by application toward the Threshold Amount, (B) second, by Sellers to the extent recovery is available under the Escrow Fund, pursuant to the Escrow Agreement, up to the Cap, and (C) thereafter, by recovery under the R&W Insurance Policy; and
(ii) with respect to any such sanctions other claim for indemnification, compensation or pursuant to this Article XI, the issuance of any such award in such arbitration. The arbitrator obligation to pay the Stipulated Amount to the Indemnitee shall also establish procedures designed to reduce the cost and time for discovery, while allowing the parties a reasonable opportunity, adequate in the sole judgment of the arbitrator, to discover relevant information from the opposing parties about the subject matter of the dispute. The arbitrator shall rule upon motions to compel or limit discovery and shall have the authority to impose sanctions, including attorneys’ fees and costsbe satisfied by Sellers as follows: (A) first, to the same extent as a court of competent law or equityrecovery is available under the Escrow Fund, should pursuant to the arbitrator determine that discovery was sought without substantial justification or that discovery was refused or objected to without substantial justification. The decision of the arbitrator, or a majority of the three (3) arbitrators, as applicable, shall be binding and conclusive upon the parties to this Escrow Agreement, and (B) thereafter, each Seller shall, within ten (10) Business Days following the Escrow Agent execution of such settlement agreement (or such shorter period of time as may be set forth in the settlement agreement), pay such Seller’s Pro Rata Share of any remaining unpaid portion of the Stipulated Amount to the Indemnitee.
(f) In the event that the Indemnitee and the Stockholder Representative fail to reach a resolution on a Notice of Claim or Contested Amount that is the subject of a Response Notice, within thirty (30) days after the date on which the Stockholder Representative delivers such Response Notice (or such longer period as the Indemnitee and the Stockholder Representative may mutually agree in writing) (whether it is a matter between the Indemnitee, on the one hand, and the Stockholder Representative, on the other hand, or it is a matter that is subject to a Proceeding asserted or commenced by a third party brought against the Indemnitee), such dispute shall be entitled to act settled in accordance with such decision the provisions of Section 14.06 and make or withhold payments out Section 14.07. If, upon and as part of the Escrow Fund final resolution of such dispute in accordance therewith. Such decision with the provisions of Section 14.06 and Section 14.07, the Indemnitee is awarded Losses (the amount of such awarded Losses being the “Awarded Amount”), then, subject to the provisions of Section 11.03:
(i) with respect to a claim for indemnification, compensation or reimbursement pursuant to Section 11.02(a), the obligation to pay the Awarded Amount to the Indemnitee shall be written satisfied (A) first, by application toward the Threshold Amount, (B) second, by Sellers to the extent recovery is available under the Escrow Fund, pursuant to the Escrow Agreement, up to the Cap, and (C) thereafter, by recovery under the R&W Insurance Policy; and
(ii) with respect to any other claim for indemnification, compensation or reimbursement pursuant to this Article XI, the obligation to pay the Awarded Amount to the Indemnitee shall be supported satisfied by written findings Sellers as follows: (A) first, to the extent recovery is available under the Escrow Fund, pursuant to the Escrow Agreement, and (B) thereafter, each Seller which shall, within ten (10) Business Days following final resolution of fact and conclusions, which shall set forth the award, judgment, decree such dispute (or order awarded by the arbitrator. Judgment upon any award rendered by the arbitrator such shorter period of time as may be entered in any court having jurisdiction. Any such arbitration shall be held in Wilmington, Delaware, stipulated under the rules then in effect terms of such final resolution), pay such Seller’s Pro Rata Share of any remaining unpaid portion of the American Arbitration AssociationAwarded Amount to the Indemnitee.
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Indemnification Claim Procedure. a. If any Indemnitee has or reasonably believes it has claims in good faith to have incurred or suffered, or reasonably believes in good faith that it is reasonably likely may (pursuant to a Third Party Claim asserted or commenced before the Survival Date) incur or suffer, Damages for which it is or will may be entitled to be held harmless, indemnified, compensated or reimbursed under Section 9 this Article VII or for which it is or will may be entitled to a monetary remedy (such as in the case of a claim based on Fraudulent breach of a representation fraud or warranty herein by or on behalf of the Companyintentional misrepresentation), such Indemnitee may deliver a notice of claim (a “Notice of Claim”) promptly, and in any case within 30 days’ of becoming aware of such claim, to the SecurityholdersStockholders’ AgentRepresentative and, to the extent any Additional Merger Consideration remains, to Parent. Each Notice of Claim shall shall: (i) state that such Indemnitee believes in good faith that such Indemnitee is or may be entitled to indemnification, compensation or reimbursement under this Article VII or is or may otherwise be entitled to a monetary remedy; (ii) contain a brief description of the basis for facts and circumstances supporting the Indemnitee’s claim; and (iii) contain a good faith, non-binding, preliminary estimate of the aggregate amount of the actual and potential Damages that the Indemnitee reasonably believes have arisen and may arise as a result of such claim facts and each circumstances (the aggregate amount of such estimate, as it may be modified by such Indemnitee shall make available in good faith from time to time, being referred to as the “Claimed Amount”).
b. During the 20-day period commencing upon delivery by an Indemnitee to the SecurityholdersStockholders’ Agent any documents and materials in such Indemnitee’s possession or control supporting the claims set forth in the Notice of Claim. In the event the Securityholders’ Agent does not notify the Indemnitee within thirty (30) days following its receipt Representative of a Notice of Claim that (the Securityholders“Claim Dispute Period”), the Stockholders’ Agent (on behalf of the Effective Time Holders) disputes the liability of the Effective Time Holders Representative may deliver to the Indemnitee under this Section 9 or who delivered the amount thereof, the claim specified in such Notice of Claim and, to the extent any Additional Merger Consideration remains, to Parent a written response (the “Response Notice”) in which the Stockholders’ Representative: (i) agrees that the full Claimed Amount is owed to the Indemnitee; (ii) agrees that part, but not all, of the Claimed Amount (such agreed portion, the “Agreed Amount”) is owed to the Indemnitee; or (iii) in good faith indicates that no part of the Claimed Amount is owed to the Indemnitee. If the Response Notice is delivered in accordance with clause (ii) or (iii) of the preceding sentence, the Response Notice shall also contain a brief description of the facts and circumstances supporting the Stockholders’ Representative’s claim that only a portion or no part of the Claimed Amount is owed to the Indemnitee, as the case may be. Any part of the Claimed Amount that is not agreed to be owed to the Indemnitee pursuant to the Response Notice (or the entire Claimed Amount, if the Stockholders’ Representative asserts in the Response Notice that no part of the Claimed Amount is owed to the Indemnitee) is referred to in this Agreement as the “Contested Amount” (it being understood that the Contested Amount shall be modified from time to time to reflect any good faith modifications by the Indemnitee to the Claimed Amount). If no Response Notice is delivered before the expiration of the Claim Dispute Period, then the Stockholders shall be conclusively deemed to have agreed that the full Claimed Amount is owed to the Indemnitee.
c. If: (i) the Stockholders’ Representative delivers a liability Response Notice agreeing that the full Claimed Amount is owed to the Indemnitee; or (ii) the Stockholders’ Representative does not deliver a Response Notice during the Claim Dispute Period, then, within three Business Days following the receipt of such Response Notice by the Effective Time Holders under this Section 9, and Parent may claim from the Escrow Amount orIndemnitee (and, to the extent any Additional Merger Consideration remains, by Parent) or within three Business Days after the expiration of the Claim Dispute Period, as the case may be: (A) to the extent any Additional Merger Consideration remains, Parent shall release to the applicable Indemnitee from the Additional Merger Consideration an amount in cash equal to the full Claimed Amount (or such lesser amount as is then the remaining funds Additional Merger Consideration).
d. If the Stockholders’ Representative delivers a Response Notice during the Claim Dispute Period agreeing that less than the full Claimed Amount is owed to the Indemnitee, then within three Business Days following the receipt of such Response Notice by the Indemnitee (and, to the extent any Additional Merger Consideration remains, by Parent), to the extent any Additional Merger Consideration remains, Parent shall release to the applicable Indemnitee from the Additional Merger Consideration an amount in cash equal to the Agreed Amount (or such lesser amount as is the remaining Additional Merger Consideration).
e. If the Stockholders’ Representative delivers a Response Notice during the Claim Dispute Period indicating that there is a Contested Amount, the Stockholders’ Representative and the Indemnitee shall attempt in good faith to resolve the dispute related to the Contested Amount. If the Indemnitee and the Stockholders’ Representative resolve such dispute, a settlement agreement stipulating the amount owed to the Indemnitee (the “Stipulated Amount”) shall be signed by the Indemnitee and the Stockholders’ Representative; provided, that other than in the Escrow case of intentional misrepresentation or fraud (as determined by a non-appealable and binding decision by a court of law having jurisdiction over the parties), in no event shall the Stipulated Amount are insufficient to cover be greater than the amount then remaining Additional Merger Consideration. Within three Business Days following the execution of such claim settlement agreement, to the extent any Additional Merger Consideration remains, Parent shall pay to the applicable Indemnitee an amount in cash equal to the Stipulated Amount (or such lesser amount as is the remaining Additional Merger Consideration).
f. In the event that there is a dispute relating to any Notice of Claim or any Contested Amount (whether it is a matter between any Indemnitee, on the one hand, and such claim the Stockholders, on the other hand, or it is not a matter that is subject to a Third Party Claim brought against any Indemnitee) that remains unresolved after application of the limitations set forth in terms of Section 9.3(c) 7.7(a)-(e), such dispute shall be settled in accordance with Section 9.3(d)8.10 hereof.
g. Notwithstanding the foregoing, nothing in this Section 7.7 shall increase or expand the Effective Time Holders shall pay indemnification obligations or liabilities of the amount of such liability to Stockholders beyond the Indemnitee on demand or, Additional Merger Consideration (except in the case of any notice in which intentional misrepresentation or fraud, as determined by a non-appealable and binding decision by a court of law having jurisdiction over the amount of the claim (or any portion of the claim) is estimatedparties, on such later date when the amount of such claim (or such portion of such claim) becomes finally determined. In the event the Securityholders’ Agent has timely disputed the liability of the Effective Time Holders (a “Claim Objection”) solely with respect to the Stockholder or Stockholders that perpetuated such claim as provided above, as promptly as possible, such Indemnitee and the Securityholders’ Agent shall establish the merits and amount of such claim (by mutual agreement, litigation, arbitration intentional misrepresentation or otherwise) and if an agreement is reached, a memorandum setting forth such agreement shall be prepared and signed by both parties and shall be furnished to the Escrow Agent. If such Indemnitee and the Securityholders’ Agent do not reach an agreement as to the merits and amount of such claim within thirty (30) days immediately after the date such Claim Objection is delivered to Parent, either Parent or the Company (or the Securityholders’ Agent after the Effective Time) may demand arbitration of the matter unless the amount of the damage or loss is at issue in pending litigation or arbitration with a third party, in which event arbitration shall not be commenced until such amount is ascertained or both parties agree to arbitration. Any arbitration requested pursuant to this Section 9.6 shall be settled by arbitration conducted by three (3) arbitrators. Parent and the Company (or the Securityholders’ Agent after the Effective Time) shall each select one (1) arbitrator, and the two (2) arbitrators so selected shall select a third arbitrator. The arbitrator shall, within ten (10) Business Days after the last day of any hearings on any motion, issue a definitive ruling on such motion. The arbitrator shall also, within twenty (20) Business Days from the last day of any hearings regarding the imposition of sanctions or the issuance of any awards, issue a definitive ruling on the imposition of any such sanctions or the issuance of any such award in such arbitration. The arbitrator shall also establish procedures designed to reduce the cost and time for discovery, while allowing the parties a reasonable opportunity, adequate in the sole judgment of the arbitrator, to discover relevant information from the opposing parties about the subject matter of the dispute. The arbitrator shall rule upon motions to compel or limit discovery and shall have the authority to impose sanctions, including attorneys’ fees and costs, to the same extent as a court of competent law or equity, should the arbitrator determine that discovery was sought without substantial justification or that discovery was refused or objected to without substantial justification. The decision of the arbitrator, or a majority of the three (3) arbitrators, as applicable, shall be binding and conclusive upon the parties to this Agreement, and the Escrow Agent shall be entitled to act in accordance with such decision and make or withhold payments out of the Escrow Fund in accordance therewith. Such decision shall be written and shall be supported by written findings of fact and conclusions, which shall set forth the award, judgment, decree or order awarded by the arbitrator. Judgment upon any award rendered by the arbitrator may be entered in any court having jurisdiction. Any such arbitration shall be held in Wilmington, Delaware, under the rules then in effect of the American Arbitration Associationfraud).
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