Common use of Indemnification Escrow Clause in Contracts

Indemnification Escrow. (a) The Escrow Deposit Amount, or from and after the Closing the Remaining Escrow Deposit Amount, shall (subject to the terms and conditions of Article 6) serve as and be the sole and exclusive source for payment of claims for indemnification by any Purchaser Indemnitee pursuant to Article 6. The Escrow Letter of Credit, which shall be provided at the Closing by Purchaser to the Escrow Agent in respect of the Escrow Deposit Amount, shall be held by the Escrow Agent in an account (the “Indemnity Escrow Account”) in accordance with the terms and conditions of an escrow agreement in the form attached hereto as Exhibit G (the “Escrow Agreement”). (b) On the date which is twelve (12) months following the Closing, the Escrow Agent shall pay and disburse to the Partnership, via a draw on the funds available under the Escrow Letter of Credit, the Initial Indemnity Release Amount calculated in accordance with Section 2.13, and the amount available to be drawn under the Escrow Letter of Credit and the aggregate principal amount of the Escrow Letter of Credit shall be reduced to reflect the foregoing draw and payment. (c) Notwithstanding anything in this Agreement or in the Escrow Agreement to the contrary, in the event that the Partnership is entitled, pursuant to this Agreement and the Escrow Agreement, to funds to be drawn from the Escrow Letter of Credit and the Escrow Agent is not able to draw all or any part of such funds from the Escrow Letter of Credit after receiving a notice (formatted as a joint written instruction) directing it to draw and release such funds, whether due to the expiration of the Escrow Letter of Credit, technical draw issues or otherwise, then, and in any such event, Purchaser shall deliver to the Partnership, by wire transfer of immediately available funds, not later than three (3) business days (with time of the essence) after a written request therefor from the Partnership, the amount of funds to which the Partnership is entitled or, if less than such amount, the remaining amount available to be drawn under the Escrow Letter of Credit, and the amount available to be drawn thereafter under the Escrow Letter of Credit (if not already equal to Zero) shall be reduced by the amount of such wire transfer. Without limiting the forgoing, any inability of the Escrow Agent to draw upon the Escrow Letter of Credit for any amount that is properly payable to the Partnership from the Escrow Letter of Credit or the Indemnity Escrow Account pursuant to this Agreement and the Escrow Agreement shall not relieve the Purchaser from its obligation to have made or to make such payment to the Partnership, and the Purchaser shall effect such payment by wire transfer in accordance with the preceding sentence. (d) If either Purchaser or the Partnership anticipates that there will be any funds remaining under the Escrow Letter of Credit as of the expiration date of the Escrow Letter of Credit (the “Escrow L/C Expiration”), then Purchaser shall use reasonable best efforts to obtain and deliver to the Escrow Agent, at least three (3) business days prior to the Escrow L/C Expiration, a replacement clean, irrevocable and unconditional standby letter of credit in the aggregate face amount equal to the amount of funds remaining under the Escrow Letter of Credit (i) in substantially the same form as the Escrow Letter of Credit or such other form as is reasonably acceptable to the Partnership and the Escrow Agent and (ii) from the then-current lender under the Escrow Letter of Credit or such other lender as is reasonably acceptable to the Partnership (the “Replacement Letter of Credit”). The Escrow Agreement shall provide that if the Escrow Agent has not received a Replacement Letter of Credit from Purchaser and written notice from the Partnership that the Replacement Letter of Credit satisfies the requirements of this Section 2.12(d) at least six (6) business days prior to the Escrow L/C Expiration, then prior to the close of business on the third (3rd) business day prior to the Escrow L/C Expiration (with time of the essence), the Escrow Agent shall draw all funds remaining under the Escrow Letter of Credit and hold such funds in the Indemnity Escrow Account for release pursuant to the applicable provisions of the Escrow Agreement (a “Full Draw Event”). Following the expiration of the Escrow Letter of Credit, all references in this Agreement and the Escrow Agreement to the Escrow Letter of Credit shall be deemed to refer to the Replacement Letter of Credit (and any subsequent replacement standby letter of credit that complies with this Section 2.12(d)), and this Section 2.12(d) shall apply to the Replacement Letter of Credit mutatis mutandis. (e) The Parties agree that the Escrow Agreement shall treat the Escrow Letter of Credit and any funds held in the Indemnity Escrow Account as owned by the Partnership for U.S. federal income tax purposes.

Appears in 2 contracts

Samples: Asset Purchase Agreement, Asset Purchase Agreement (Alico Inc)

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Indemnification Escrow. (a) The Escrow Deposit Subject to the applicable limitations set forth in this Article X, any amounts due by Seller to Purchaser pursuant to this Article X shall be first satisfied from the Escrowed Shares. To the extent that Purchaser is determined to be owed by Seller amounts in excess of the Indemnification Holdback Amount, or Purchaser may seek payment for such amounts from and after the Closing the Remaining Escrow Deposit AmountSeller, shall (subject to the terms and conditions of Article 6limitations set forth in Section 10.4. (b) serve as and be the sole and exclusive source for payment of claims for indemnification by If Seller does not dispute any Purchaser Indemnitee pursuant to Article 6. The Escrow Letter of Credit, which shall be provided at the Closing claim made by Purchaser against Seller, Seller and Purchaser shall provide written instructions to the Escrow Agent in respect accordance with the Escrow Agreement to disburse to Purchaser a number of Escrowed Shares equal to the amount of the Escrow Deposit Amountundisputed claim divided by the Per Share Price. If Seller does dispute any claim made by Purchaser, then upon the final non-appealable determination of the amount in question (or an agreement between the Parties), as applicable, with respect to such claim, Seller and Purchaser shall be held by provide written instructions to the Escrow Agent in an account (to disburse to Purchaser a number of Escrowed Shares equal to the “Indemnity Escrow Account”) in accordance with amount determined by such final, non-appealable determination or agreement to be due pursuant to the terms and conditions of an escrow agreement in the form attached hereto as Exhibit G (the “Escrow Agreement”). (b) On the date which is twelve (12) months following the Closing, the Escrow Agent shall pay and disburse to the Partnership, via a draw on the funds available under the Escrow Letter of Credit, the Initial Indemnity Release Amount calculated in accordance with Section 2.13, and the amount available to be drawn under the Escrow Letter of Credit and the aggregate principal amount of the Indemnification Escrow Letter of Credit shall be reduced to reflect Agreement divided by the foregoing draw and paymentPer Share Price. (c) Notwithstanding anything in this Agreement or in On the Escrow Agreement to the contrary, in the event that the Partnership is entitled, pursuant to this Agreement and the Escrow Agreement, to funds to be drawn from the Escrow Letter of Credit and the Escrow Agent is not able to draw all or any part of such funds from the Escrow Letter of Credit after receiving a notice first (formatted as a joint written instruction1st) directing it to draw and release such funds, whether due to the expiration anniversary of the Escrow Letter of Credit, technical draw issues or otherwise, then, and in any such eventClosing Date, Purchaser and Seller shall deliver to the Partnership, by wire transfer of immediately available funds, not later than three (3) business days (with time of the essence) after a written request therefor from the Partnership, the amount of funds to which the Partnership is entitled or, if less than such amount, the remaining amount available to be drawn under the Escrow Letter of Credit, and the amount available to be drawn thereafter under the Escrow Letter of Credit (if not already equal to Zero) shall be reduced by the amount of such wire transfer. Without limiting the forgoing, any inability of instruct the Escrow Agent to draw upon release to Seller all of the Escrow Letter then-remaining Escrowed Shares, save and except a number of Credit Escrowed Shares equal to (i) the sum of (A) Ten Million Dollars ($10,000,000) plus (B) the aggregate amount of all unsatisfied claims for any amount indemnification that is properly payable to the Partnership from the Escrow Letter of Credit Purchaser has validly made against Seller on or the Indemnity Escrow Account before such date pursuant to this Agreement Article X and which are subject to satisfaction (in whole or in part) from the Escrowed Shares, divided by (ii) the Per Share Price. On the date that is eighteen (18) months after the Closing Date, Purchaser and Seller shall instruct the Escrow Agreement shall not relieve Agent to release to Seller the Purchaser from its obligation to have made or to make such payment then-remaining Escrowed Shares, save and except a number of Escrowed Shares equal to the Partnershipaggregate amount of all unsatisfied claims for indemnification that Purchaser has validly made against Seller on or before such date pursuant to this Article X and which are subject to satisfaction (in whole or in part) from the Escrowed Shares, and divided by the Purchaser shall effect such payment by wire transfer in accordance with the preceding sentencePer Share Price. (d) If either Purchaser or the Partnership anticipates that there will be any funds remaining under the Escrow Letter of Credit as of the expiration date of the Escrow Letter of Credit (the “Escrow L/C Expiration”), then Purchaser shall use reasonable best efforts to obtain and deliver to the Escrow Agent, at least three (3) business days prior to the Escrow L/C Expiration, a replacement clean, irrevocable and unconditional standby letter of credit in the aggregate face amount equal to the amount of funds remaining under the Escrow Letter of Credit (i) in substantially the same form as the Escrow Letter of Credit or such other form as is reasonably acceptable to the Partnership and the Escrow Agent and (ii) from the then-current lender under the Escrow Letter of Credit or such other lender as is reasonably acceptable to the Partnership (the “Replacement Letter of Credit”). The Escrow Agreement shall provide that if the Escrow Agent has not received a Replacement Letter of Credit from Purchaser and written notice from the Partnership that the Replacement Letter of Credit satisfies the requirements of this Section 2.12(d) at least six (6) business days prior to the Escrow L/C Expiration, then prior to the close of business on the third (3rd) business day prior to the Escrow L/C Expiration (with time of the essence), the Escrow Agent shall draw all funds remaining under the Escrow Letter of Credit and hold such funds in the Indemnity Escrow Account for release pursuant to the applicable provisions of the Escrow Agreement (a “Full Draw Event”). Following the expiration of the Escrow Letter of Credit, all references in this Agreement and the Escrow Agreement to the Escrow Letter of Credit shall be deemed to refer to the Replacement Letter of Credit (and any subsequent replacement standby letter of credit that complies with this Section 2.12(d)), and this Section 2.12(d) shall apply to the Replacement Letter of Credit mutatis mutandis. (e) The Parties agree that to provide joint written instructions to the Indemnification Escrow Agreement shall treat Agent to distribute the Escrow Letter of Credit Escrowed Shares as and any funds held when provided in the Indemnity Escrow Account as owned by the Partnership for U.S. federal income tax purposesthis Agreement.

Appears in 2 contracts

Samples: Securities Purchase Agreement (WPX Energy, Inc.), Securities Purchase Agreement (WPX Energy, Inc.)

Indemnification Escrow. (a) The At Closing, Purchaser will deposit, in accordance with Section 2.5(b), Six Million Dollars ($6,000,000.00) of the Purchase Price (the “Indemnification Escrow Deposit Amount, or from and after the Closing the Remaining Escrow Deposit Amount, shall (subject to the terms and conditions of Article 6) serve as and be the sole and exclusive source for payment of claims for indemnification by any Purchaser Indemnitee pursuant to Article 6. The Escrow Letter of Credit, which shall be provided at the Closing by Purchaser to with the Escrow Agent in respect as security for the indemnification obligations of the Seller under Section 8.2 hereof. The Indemnification Escrow Deposit Amount, Amount shall be held by the Escrow Agent in an account (the “Indemnity Escrow Account”) in accordance with the terms and conditions of an escrow agreement set forth herein and in the form attached hereto as Exhibit G Escrow Agreement (the “Indemnification Escrow AgreementFund”). All costs and expenses of the Indemnification Escrow Fund shall be split equally by Seller and Purchaser. Any portion of the Indemnification Escrow Amount not previously released by the Escrow Agent to Purchaser as a result of an indemnification claim by Purchaser Indemnitee shall be released to Seller or its designees on the Escrow Release Date; provided, however, that a portion of the Indemnification Escrow Fund, which, in the good faith, reasonable judgment of Purchaser, is necessary to satisfy any pending but unresolved or unsatisfied claims specified in any Notice of Claim theretofore delivered to Seller pursuant to Section 8.4 prior to termination of the Escrow Period with respect to facts and circumstances existing prior to expiration of the Escrow Period, shall be retained by the Escrow Agent until such claims have been resolved. (b) On Any portion of the date which is twelve Indemnification Escrow Amount accordingly retained on or after the Escrow Release Date shall be released to Seller or Purchaser (12as appropriate) months following the Closing, by the Escrow Agent shall pay and disburse to the Partnership, via a draw on the funds available under the Escrow Letter promptly upon resolution of Credit, the Initial Indemnity Release Amount calculated in accordance with Section 2.13, and the amount available to be drawn under the Escrow Letter of Credit and the aggregate principal amount of the Escrow Letter of Credit shall be reduced to reflect the foregoing draw and paymenteach specific claim involved. (c) Notwithstanding anything in this Agreement or in the Escrow Agreement to the contrary, in the event that the Partnership is entitled, pursuant to this Agreement and the Escrow Agreement, to funds to be drawn from the Escrow Letter of Credit and the Escrow Agent is not able to draw all or any part of such funds from the Escrow Letter of Credit after receiving a notice (formatted as a joint written instruction) directing it to draw and release such funds, whether due to the expiration of the Escrow Letter of Credit, technical draw issues or otherwise, then, and in any such event, Purchaser shall deliver to the Partnership, by wire transfer of immediately available funds, not later than three (3) business days (with time of the essence) after a written request therefor from the Partnership, the amount of funds to which the Partnership is entitled or, if less than such amount, the remaining amount available to be drawn under the Escrow Letter of Credit, and the amount available to be drawn thereafter under the Escrow Letter of Credit (if not already equal to Zero) shall be reduced by the amount of such wire transfer. Without limiting the forgoing, any inability of the Escrow Agent to draw upon the Escrow Letter of Credit for any amount that is properly payable to the Partnership from the Escrow Letter of Credit or the Indemnity Escrow Account pursuant to this Agreement and the Escrow Agreement shall not relieve the Purchaser from its obligation to have made or to make such payment to the Partnership, and the Purchaser shall effect such payment by wire transfer in accordance with the preceding sentence. (d) If either Purchaser or the Partnership anticipates that there will be any funds remaining under the Escrow Letter of Credit as of the expiration date of the Escrow Letter of Credit (the “Escrow L/C Expiration”), then Purchaser shall use reasonable best efforts to obtain and deliver to the Escrow Agent, at least three (3) business days prior to the Escrow L/C Expiration, a replacement clean, irrevocable and unconditional standby letter of credit in the aggregate face amount equal to the amount of funds remaining under the Escrow Letter of Credit (i) in substantially the same form as the Escrow Letter of Credit or such other form as is reasonably acceptable to the Partnership and the Escrow Agent and (ii) from the then-current lender under the Escrow Letter of Credit or such other lender as is reasonably acceptable to the Partnership (the “Replacement Letter of Credit”). The Escrow Agreement shall provide that if the Escrow Agent has not received a Replacement Letter of Credit from Purchaser and written notice from the Partnership that the Replacement Letter of Credit satisfies the requirements of this Section 2.12(d) at least six (6) business days prior to the Escrow L/C Expiration, then prior to the close of business on the third (3rd) business day prior to the Escrow L/C Expiration (with time of the essence), the Escrow Agent shall draw all funds remaining under the Escrow Letter of Credit and hold such funds in the Indemnity Escrow Account for release pursuant to the applicable provisions of the Escrow Agreement (a “Full Draw Event”). Following the expiration of the Escrow Letter of Credit, all references in this Agreement and the Escrow Agreement to the Escrow Letter of Credit shall be deemed to refer to the Replacement Letter of Credit (and any subsequent replacement standby letter of credit that complies with this Section 2.12(d)), and this Section 2.12(d) shall apply to the Replacement Letter of Credit mutatis mutandis. (e) The Parties agree that the Escrow Agreement shall treat the Escrow Letter of Credit and any funds held in the Indemnity Escrow Account as owned by the Partnership for U.S. federal income tax purposes.

Appears in 2 contracts

Samples: Asset Purchase Agreement (Integrated Device Technology Inc), Asset Purchase Agreement (Integrated Device Technology Inc)

Indemnification Escrow. a. Notwithstanding the foregoing provisions of Section 1, at the Closing, One Million Dollars (a$1,000,000) The (the “Xxxxxxxxx Family Escrow Deposit Amount, or from and after ”) of the Closing the Remaining Escrow Deposit Amount, shall (subject to the terms and conditions of Article 6) serve as and be the sole and exclusive source for payment of claims for indemnification by any Purchaser Indemnitee pursuant to Article 6. The Escrow Letter of Credit, which Aggregate Purchase Price shall be provided at the Closing paid by Purchaser MSN to the Escrow Agent to be held in respect escrow as part of the Indemnification Escrow Deposit Amount, Amount as contemplated by the Merger Agreement. The amount otherwise payable to each Xxxxxxxxx Family Party at the Closing pursuant to Section 1 shall be held reduced by such Xxxxxxxxx Family Party’s pro rata share of the Xxxxxxxxx Family Escrow Agent in an account Amount (the “Indemnity Escrow Account”) in accordance with the terms total number of Purchased Shares sold by each of them), which amount is specified next to each such Xxxxxxxxx Family Party’s name on Annex A hereto. Such contribution shall be in lieu of, and conditions not in addition to, a portion of an escrow agreement in the form attached hereto as Exhibit G (Indemnification Escrow Amount that would otherwise be contributed by the Indemnification Escrow Agreement”). (b) On the date which is twelve (12) months following the Closing, the Escrow Agent shall pay and disburse Participants to the Partnership, via a draw on the funds available under the Indemnification Escrow Letter of Credit, the Initial Indemnity Release Amount calculated in accordance with pursuant to Section 2.13, and the amount available to be drawn under the Escrow Letter of Credit and the aggregate principal amount 1.5(e) of the Escrow Letter of Credit shall be reduced to reflect the foregoing draw and payment. (c) Notwithstanding anything in this Agreement or in the Escrow Agreement to the contrary, in the event that the Partnership is entitled, pursuant to this Merger Agreement and the Escrow Agreementaccordingly, to funds to be drawn from the Escrow Letter of Credit and the Escrow Agent is not able to draw all or any part of such funds from the Escrow Letter of Credit after receiving a notice (formatted as a joint written instruction) directing it to draw and release such fundsMSN agrees that, whether due to the expiration upon payment of the Xxxxxxxxx Family Escrow Letter of Credit, technical draw issues or otherwise, then, and in any such event, Purchaser shall deliver to the Partnership, by wire transfer of immediately available funds, not later than three (3) business days (with time of the essence) after a written request therefor from the Partnership, the amount of funds to which the Partnership is entitled or, if less than such amount, the remaining amount available to be drawn under the Escrow Letter of Credit, and the amount available to be drawn thereafter under the Escrow Letter of Credit (if not already equal to Zero) shall be reduced by the amount of such wire transfer. Without limiting the forgoing, any inability of the Escrow Agent to draw upon the Escrow Letter of Credit for any amount that is properly payable to the Partnership from the Escrow Letter of Credit or the Indemnity Escrow Account pursuant to this Agreement and the Escrow Agreement shall not relieve the Purchaser from its obligation to have made or to make such payment to the Partnership, and the Purchaser shall effect such payment by wire transfer in accordance with the preceding sentence. (d) If either Purchaser or the Partnership anticipates that there will be any funds remaining under the Escrow Letter of Credit as of the expiration date of the Escrow Letter of Credit (the “Escrow L/C Expiration”), then Purchaser shall use reasonable best efforts to obtain and deliver Amount to the Escrow Agent, at least three (3) business days prior a portion of the Indemnification Escrow Amount equal to the Xxxxxxxxx Family Escrow L/C ExpirationAmount, a replacement clean, irrevocable and unconditional standby letter of credit in shall immediately be distributed to the aggregate face Indemnification Escrow Participants an amount equal to the amount of funds remaining under the One Million Dollars $1,000,000, pro rata in accordance with their respective Indemnification Escrow Letter of Credit Percentages (i) in substantially the same form as the Escrow Letter of Credit or if such other form as contribution is reasonably acceptable made at Closing, such amounts shall be delivered to the Partnership Exchange Agent and distributed with the Merger Consideration as specified by the Holder Representative) and each Escrow Participant’s Indemnification Escrow Percentages shall thereafter be reduced to a percentage equal to such Escrow Participant’s Indemnification Percentage as provided in the Merger Agreement multiplied by a fraction the numerator of which is $3,600,000 and the denominator of which is $4,600,000, such that the reduced Escrow Agent Participants’ Indemnification Escrow Percentages together with each Xxxxxxxxx Family Party’s Indemnification Escrow Percentage (as specified next to such Xxxxxxxxx Family Party’s name on Annex A hereto) shall equal 100%. b. Each Xxxxxxxxx Family Party shall thereafter have an interest in a proportionate share of the Indemnification Escrow Amount held in escrow from time to time equal to such Xxxxxxxxx Family Party’s Indemnification Escrow Percentage (as specified next to such Xxxxxxxxx Family Party’s name on Annex A hereto) and (ii) shall be liable, solely from the then-current lender under the Escrow Letter of Credit or such other lender as is reasonably acceptable amounts contributed to the Partnership Indemnification Escrow Amount, for the payment of a proportionate share of any amounts payable pursuant to Article XI of the Merger Agreement (or that certain letter agreement by and between MSN and the Company, dated as of the date of the Merger Agreement, related thereto, a copy of which has been provided to the Xxxxxxxxx Family Parties or their counsel (the “Replacement Letter of CreditAgreement”)) as a result of the final resolution of any claim made by an Acquiror Indemnitee for indemnification thereunder (including, as a result of any determination by the Holder Representative that such Acquiror Indemnitee is entitled to indemnification). If any Acquiror Indemnitee is entitled to a distribution of all or any portion of the Indemnification Escrow Amount with respect to any claim for indemnification made pursuant to Article XI of the Merger Agreement or the Letter Agreement, each Xxxxxxxxx Family Party agrees that such Xxxxxxxxx Family Party’s interest in the Indemnification Escrow Amount shall be reduced by an amount equal to (x) such Xxxxxxxxx Family Party’s Indemnification Escrow Percentage, multiplied by (y) the aggregate amount distributed to such Acquiror Indemnitee from the Indemnification Escrow Amount. The Xxxxxxxxx Family Escrow Amount shall otherwise be held as part of the Indemnification Escrow Amount in accordance with the Indemnification Escrow Agreement shall provide that if the Escrow Agent has not received a Replacement Letter of Credit from Purchaser and written notice from the Partnership that the Replacement Letter of Credit satisfies the requirements of this Section 2.12(d) at least six (6) business days prior to the Escrow L/C Expiration, then prior to the close of business on the third (3rd) business day prior to the Escrow L/C Expiration (with time of the essence), the Escrow Agent shall draw all funds remaining under the Escrow Letter of Credit and hold such funds in the Indemnity Escrow Account for release pursuant to the applicable provisions of the Escrow Agreement (a “Full Draw Event”)Merger Agreement, each of which are incorporated by reference herein. Following Without limiting the expiration foregoing, any time at which distributions of the Indemnification Escrow Letter of Credit, all references in this Agreement and the Escrow Agreement Amount are made to the Escrow Letter of Credit Participants, each Xxxxxxxxx Family Party shall be deemed entitled to refer a proportionate share of such distribution in accordance with their respective Indemnification Escrow Percentages. c. By executing this Agreement, each Xxxxxxxxx Family Party agrees to the Replacement Letter designation of Credit (and any subsequent replacement standby letter of credit that complies TC Group, L.L.C. as the Holder Representative to act on their behalf with this Section 2.12(d)), and this Section 2.12(d) shall apply respect to the Replacement Letter resolution of Credit mutatis mutandis. (e) The any Asserted Liability and that Section 13.2 of the Merger Agreement is incorporated herein by reference and applies to the Xxxxxxxxx Family Parties agree that the Escrow Agreement shall treat the Escrow Letter in respect of Credit and any funds held their interest in the Indemnity Indemnification Escrow Account as owned by the Partnership for U.S. federal income tax purposesAmount.

Appears in 1 contract

Samples: Purchase Agreement (Medical Staffing Network Holdings Inc)

Indemnification Escrow. (a) The Escrow Deposit Amount, or from and after the Closing the Remaining Escrow Deposit Amount, shall (subject to the terms and conditions of Article 6) serve as and Shares will be the sole and exclusive source for payment of claims for indemnification by any Purchaser Indemnitee pursuant to Article 6. The Escrow Letter of Credit, which shall be provided at the Closing by Purchaser delivered to the Escrow Agent in respect accordance with the terms of Section 2 to be held and released in accordance with the Escrow Agreement as security of the indemnification obligations of the Securityholders under this Section 8 hereof. The Escrow Agreement will provide, among other things, that any portion of the Escrow Deposit AmountShares not previously released to Acquiror, or retained by Escrow Agent, as a result of an indemnification claim by Acquiror shall be held released to the Securityholders on the Escrow Termination Date in accordance with the terms of the Escrow Agreement; provided, however, that if there remain any unsatisfied claims specified in any Officer’s Certificate delivered by Acquiror to the Securityholders’ Agent in accordance with Section 8.4 and prior to the Escrow Termination Date with respect to facts and circumstances existing prior to the Escrow Termination Date, a portion of the Escrow Shares shall be retained by the Escrow Agent in an account (the “Indemnity Escrow Account”) in accordance with the terms of the Escrow Agreement until such claims have been resolved (whether by agreement of the parties or as a result of any final decision, judgment or award). The portion of the Escrow Shares to be retained shall be based on the aggregate value of the unsatisfied claims as of the Escrow Termination Date, which value shall be determined upon the mutual agreement of the parties, and conditions if no such agreement can be reached within 15 days following the Escrow Termination Date, the Independent Accounting Firm shall determine the value of the unsatisfied claims, or, if the Independent Accounting Firm refuses to make such determination, then such dispute shall be resolved in accordance with Section 8.6 of this Agreement. For purposes of this Section 8, Securityholders that receive Stock Merger Consideration shall be entitled to use shares of Acquiror Common Stock issued as Stock Merger Consideration to satisfy Damages that are due and payable to an escrow agreement in Acquiror Indemnified Person and any such shares of Acquiror Common Stock shall be valued at ***. *** Portions of this page have been omitted pursuant to a request for Confidential Treatment filed separately with the form attached hereto as Exhibit G (the “Escrow Agreement”)Commission. (b) On the date which is twelve (12) months following Escrow Termination Date, Acquiror and the Closing, Securityholders’ Agent shall cause the Escrow Agent shall pay and disburse to release to the Partnership, via a draw applicable Securityholders the applicable portion of the Escrow Shares set forth on the funds available under Closing Payment Schedule (the “Applicable Portion”), less with respect to each such Securityholder such portion of the Escrow Letter Shares with a value (as determined pursuant to Section 8.1) equal to such Securityholder’s Applicable Portion of Credit, the Initial Indemnity Release Amount calculated Escrow Shares withheld by the Escrow Agent in accordance with Section 2.13, and the amount available to be drawn under the Escrow Letter of Credit and the aggregate principal amount of the Escrow Letter of Credit shall be reduced to reflect the foregoing draw and payment. (c) Notwithstanding anything in this Agreement or in the Escrow Agreement to the contrary, in the event that the Partnership is entitled, pursuant to this Agreement and the Escrow Agreement, to funds to be drawn from the Escrow Letter of Credit and the Escrow Agent is not able to draw all or any part of such funds from the Escrow Letter of Credit after receiving a notice (formatted as a joint written instruction) directing it to draw and release such funds, whether due to the expiration of the Escrow Letter of Credit, technical draw issues or otherwise, then, and in any such event, Purchaser shall deliver to the Partnership, by wire transfer of immediately available funds, not later than three (3) business days (with time of the essence) after a written request therefor from the Partnership, the amount of funds to which the Partnership is entitled or, if less than such amount, the remaining amount available to be drawn under the Escrow Letter of Credit, and the amount available to be drawn thereafter under the Escrow Letter of Credit (if not already equal to Zero) shall be reduced by the amount of such wire transfer. Without limiting the forgoing, any inability of the Escrow Agent to draw upon the Escrow Letter of Credit for any amount that is properly payable to the Partnership from the Escrow Letter of Credit or the Indemnity Escrow Account pursuant to this Agreement and the Escrow Agreement shall not relieve the Purchaser from its obligation to have made or to make such payment to the Partnership, and the Purchaser shall effect such payment by wire transfer in accordance with the preceding sentence. (d) If either Purchaser or the Partnership anticipates that there will be any funds remaining under the Escrow Letter of Credit as of the expiration date of the Escrow Letter of Credit (the “Escrow L/C Expiration”), then Purchaser shall use reasonable best efforts to obtain and deliver to the Escrow Agent, at least three (3) business days prior to the Escrow L/C Expiration, a replacement clean, irrevocable and unconditional standby letter of credit in the aggregate face amount equal to the amount of funds remaining under the Escrow Letter of Credit (i) in substantially the same form as the Escrow Letter of Credit or such other form as is reasonably acceptable to the Partnership and the Escrow Agent 8.4 and/or Section 2.13 and (ii) from the then-current lender under such Securityholder’s Applicable Portion of the Escrow Letter Shares held by the Escrow Agent in accordance with Section 8.1 with respect to any pending but unresolved indemnification claims of Credit or such other lender Acquiror. Any portion of the Escrow Shares held as is reasonably acceptable a result of clause (ii) shall be released to the Partnership Securityholders or released to Acquiror (the “Replacement Letter as appropriate) promptly upon resolution of Credit”)each specific claim or dispute involved. The Escrow Agreement Shares shall provide that if the Escrow Agent has not received a Replacement Letter of Credit from Purchaser and written notice from the Partnership that the Replacement Letter of Credit satisfies the requirements of this Section 2.12(d) at least six (6) business days prior to the Escrow L/C Expiration, then prior to the close of business on the third (3rd) business day prior to the Escrow L/C Expiration (with time of the essence), the Escrow Agent shall draw all funds remaining under the Escrow Letter of Credit and hold such funds in the Indemnity Escrow Account for release pursuant be released to the applicable provisions Securityholders in proportion to their respective Applicable Portion of the Escrow Agreement (a “Full Draw Event”). Following Shares, as set forth on the expiration of the Escrow Letter of Credit, all references in this Agreement and the Escrow Agreement to the Escrow Letter of Credit shall be deemed to refer to the Replacement Letter of Credit (and any subsequent replacement standby letter of credit that complies with this Section 2.12(d)), and this Section 2.12(d) shall apply to the Replacement Letter of Credit mutatis mutandisClosing Payment Schedule. (e) The Parties agree that the Escrow Agreement shall treat the Escrow Letter of Credit and any funds held in the Indemnity Escrow Account as owned by the Partnership for U.S. federal income tax purposes.

Appears in 1 contract

Samples: Merger Agreement (Active Network Inc)

Indemnification Escrow. (a) The Escrow Deposit AmountTo the extent that any Parent Indemnified Party is entitled to any indemnification payments, or from and after the Closing the Remaining Escrow Deposit Amount, shall (subject to the terms and conditions of Article 6) serve as and be the sole and exclusive source for payment of claims for such indemnification by any Purchaser Indemnitee pursuant to Article 6. The Escrow Letter of Credit, which payments shall be provided at the Closing by Purchaser disbursed to the Escrow Agent in respect of the Escrow Deposit Amount, shall be held by the Escrow Agent in an account (the “Indemnity Escrow Account”) in accordance with the terms and conditions of an escrow agreement in the form attached hereto as Exhibit G (the “Escrow Agreement”). (b) On the date which is twelve (12) months following the Closing, the Escrow Agent shall pay and disburse to the Partnership, via a draw on the funds available under the Escrow Letter of Credit, the Initial Indemnity Release Amount calculated in accordance with Section 2.13, and the amount available to be drawn under the Escrow Letter of Credit and the aggregate principal amount of the Escrow Letter of Credit shall be reduced to reflect the foregoing draw and payment. (c) Notwithstanding anything in this Agreement or in the Escrow Agreement to the contrary, in the event that the Partnership is entitled, pursuant to this Agreement and the Escrow Agreement, to funds to be drawn from the Escrow Letter of Credit and the Escrow Agent is not able to draw all or any part of such funds from the Escrow Letter of Credit after receiving a notice (formatted as a joint written instruction) directing it to draw and release such funds, whether due to the expiration of the Escrow Letter of Credit, technical draw issues or otherwise, then, and in any such event, Purchaser shall deliver to the Partnership, Parent Indemnified Party by wire transfer of immediately available fundsfunds from the Indemnification Escrow Account. (b) In accordance with the Escrow Agreement, not later than three unless any such balance is then subject to a pending claim or dispute, (3i) business days on the twelve (with time 12)-month anniversary of the essenceClosing Date the parties shall provide a joint written instruction to the Escrow Agent to release an amount equal to fifty percent (50%) after a written request therefor from of (x) the Partnershipbalance of the cash held in the Indemnification Escrow Account, minus (y) the amount of funds to which any then-pending but unresolved claims; and (ii) on the Partnership is entitled or, if less than such amountSurvival Termination Date, the remaining amount available parties shall provide a joint written instruction to be drawn under the Escrow Letter Agent to release an amount equal to one hundred percent (100%) of Credit(x) the balance of the cash held in the Indemnification Escrow Account, minus (y) the amount of any then-pending but unresolved claims. Such joint written instructions to the Escrow Agent shall cause the Escrow Agent to pay the amounts set forth above to the Payments Administrator for the benefit of the Securityholders. The Payments Administrator shall distribute to each Securityholder its pro rata portion thereof based on its Pro Rata Percentage; provided that to the extent a Securityholder is a holder of Cash-Out Options or a MIP Participant, the Payments Administrator shall deposit with the Surviving Company any portion of such amount payable to such holder of Cash-Out Options or MIP Participant, and Parent shall cause the Surviving Company, as promptly practicable following such deposit, to distribute to each such holder or participant such amounts, and the amount available distributed to be drawn thereafter under the Escrow Letter of Credit (if not already equal to Zero) other Securityholders shall be reduced by accordingly. Upon final resolution of any unresolved claim in respect of which an amount (that otherwise would have been released pursuant to the amount first sentence of such wire transfer. Without limiting this Section 9.05(b)) had been retained (to the forgoingextent not utilized to satisfy valid claims for indemnification pursuant to Section 9.02(a)), any inability of the parties shall provide a joint written instruction to the Escrow Agent to draw upon deliver such amount promptly from the Indemnification Escrow Account by wire transfer of immediately available funds and shall be paid to each Securityholder in accordance with the process set forth in the preceding sentence and the terms of the Escrow Letter Agreement. (c) Promptly upon any Person becoming entitled to release of Credit for any amount that is properly payable to the Partnership amounts from the Escrow Letter of Credit or the Indemnity Indemnification Escrow Account pursuant to Section 7.03(b) or this Agreement and Article IX or the Escrow Agreement Agreement, the parties shall not relieve the Purchaser from its obligation to have made or to make such payment to the Partnership, and the Purchaser shall effect such payment by wire transfer in accordance with the preceding sentence. (d) If either Purchaser or the Partnership anticipates that there will be any funds remaining under the Escrow Letter of Credit as of the expiration date of the Escrow Letter of Credit (the “Escrow L/C Expiration”), then Purchaser shall use reasonable best efforts to obtain and deliver execute joint written instructions to the Escrow Agent, at least three (3) business days prior to the Escrow L/C Expiration, a replacement clean, irrevocable and unconditional standby letter of credit in the aggregate face amount equal to the amount of funds remaining under the Escrow Letter of Credit (i) in substantially the same form as the Escrow Letter of Credit or such other form as is reasonably acceptable to the Partnership and Agent instructing the Escrow Agent and (ii) from the then-current lender under the Escrow Letter of Credit or to so release such other lender as is reasonably acceptable to the Partnership (the “Replacement Letter of Credit”). The Escrow Agreement shall provide that if the Escrow Agent has not received a Replacement Letter of Credit from Purchaser and written notice from the Partnership that the Replacement Letter of Credit satisfies the requirements of this Section 2.12(d) at least six (6) business days prior to the Escrow L/C Expiration, then prior to the close of business on the third (3rd) business day prior to the Escrow L/C Expiration (with time of the essence), the Escrow Agent shall draw all funds remaining under the Escrow Letter of Credit and hold such funds in the Indemnity Escrow Account for release pursuant to the applicable provisions of the Escrow Agreement (a “Full Draw Event”). Following the expiration of the Escrow Letter of Credit, all references in this Agreement and the Escrow Agreement to the Escrow Letter of Credit shall be deemed to refer to the Replacement Letter of Credit (and any subsequent replacement standby letter of credit that complies with this Section 2.12(d)), and this Section 2.12(d) shall apply to the Replacement Letter of Credit mutatis mutandisamounts. (e) The Parties agree that the Escrow Agreement shall treat the Escrow Letter of Credit and any funds held in the Indemnity Escrow Account as owned by the Partnership for U.S. federal income tax purposes.

Appears in 1 contract

Samples: Merger Agreement (Cabot Microelectronics Corp)

Indemnification Escrow. Pursuant to Article 11 hereof, the parties hereto have agreed that (a) The Escrow Deposit Amount, or the Buyer Indemnified Parties will be indemnified from and after against certain Buyer Indemnified Company Costs, and (b) the Closing Securityholder Parties will severally, but not jointly, indemnify the Remaining Escrow Deposit AmountBuyer Indemnified Parties from and against certain Buyer Indemnified Securityholder Party Costs. On or prior to Closing, shall (subject to the terms Representative, Parent and conditions of Article 6) serve as and be the sole and exclusive source for payment of claims for indemnification by any Purchaser Indemnitee pursuant to Article 6. The Escrow Letter of Credit, which shall be provided at the Closing by Purchaser to the Escrow Agent shall enter into an Indemnification Escrow Agreement in respect form and substance (i) customary for transactions of this type, (ii) consistent with the Escrow Deposit Amountterms of this Agreement and (iii) reasonably satisfactory to the Company, shall be held by Parent, the Representative and the Escrow Agent in an account (the “Indemnity Escrow Account”) in accordance with the terms and conditions of an escrow agreement in the form attached hereto as Exhibit G (the “Indemnification Escrow Agreement”). (b) On the date which is twelve (12) months following the Closing, the Escrow Agent shall pay and disburse to the Partnership, via a draw on the funds available under the Escrow Letter of Credit, the Initial Indemnity Release Amount calculated in accordance with Section 2.13, and the amount available to be drawn under the Escrow Letter of Credit and the aggregate principal amount of the Escrow Letter of Credit shall be reduced to reflect the foregoing draw and payment. (c) . Notwithstanding anything any other provision in this Agreement or in the Escrow Agreement to the contrary, in order to secure the event that indemnity obligations to the Partnership is entitledBuyer Indemnified Parties under this Agreement, at the Closing a portion of the Merger Consideration which would otherwise be required to be delivered to the Securityholders equal to the Closing Escrow Amount shall be deposited and held in escrow pursuant to this Agreement and the terms of the Indemnification Escrow Agreement, . Each Securityholder Party hereby directs Parent to funds deposit an amount equal to be drawn from the such Securityholder Party’s Indemnity Escrow Letter of Credit and Holdback Amount with the Escrow Agent is not able to draw all or any part of at Closing and Parent shall make such funds from the Escrow Letter of Credit after receiving a notice (formatted deposit as a joint written instruction) directing it to draw and release such funds, whether due to the expiration of the Escrow Letter of Credit, technical draw issues or otherwise, then, and in any such event, Purchaser shall deliver to the Partnership, directed. Any amounts held by wire transfer of immediately available funds, not later than three (3) business days (with time of the essence) after a written request therefor from the Partnership, the amount of funds to which the Partnership is entitled or, if less than such amount, the remaining amount available to be drawn under the Escrow Letter of Credit, and the amount available to be drawn thereafter under the Escrow Letter of Credit (if not already equal to Zero) shall be reduced by the amount of such wire transfer. Without limiting the forgoing, any inability of the Escrow Agent to draw upon the Escrow Letter of Credit for any amount that is properly payable pursuant to the Partnership from the Escrow Letter of Credit or the Indemnity Escrow Account pursuant to this Agreement and the Indemnification Escrow Agreement shall not relieve the Purchaser from its obligation to have made or to make such payment be released to the Partnership, Securityholder Parties only at such times and the Purchaser shall effect in such payment by wire transfer in accordance with the preceding sentence. (d) If either Purchaser or the Partnership anticipates that there will be any funds remaining under the Escrow Letter of Credit amounts as of the expiration date of the Escrow Letter of Credit (the “Escrow L/C Expiration”), then Purchaser shall use reasonable best efforts to obtain and deliver to the Escrow Agent, at least three (3) business days prior to the Escrow L/C Expiration, a replacement clean, irrevocable and unconditional standby letter of credit set forth in the aggregate face amount equal to the amount of funds remaining under the Indemnification Escrow Letter of Credit (i) in substantially the same form as the Escrow Letter of Credit or such other form as is reasonably acceptable to the Partnership and the Escrow Agent and (ii) from the then-current lender under the Escrow Letter of Credit or such other lender as is reasonably acceptable to the Partnership (the “Replacement Letter of Credit”). The Escrow Agreement shall provide that if the Escrow Agent has not received a Replacement Letter of Credit from Purchaser and written notice from the Partnership that the Replacement Letter of Credit satisfies the requirements of this Section 2.12(d) at least six (6) business days prior to the Escrow L/C Expiration, then prior to the close of business on the third (3rd) business day prior to the Escrow L/C Expiration (with time of the essence), the Escrow Agent shall draw all funds remaining under the Escrow Letter of Credit and hold such funds in the Indemnity Escrow Account for release pursuant to the applicable provisions of the Escrow Agreement (a “Full Draw Event”). Following the expiration of the Escrow Letter of Credit, all references in this Agreement and the Escrow Agreement to the Escrow Letter of Credit shall be deemed to refer to the Replacement Letter of Credit (and any subsequent replacement standby letter of credit that complies with this Section 2.12(d)), and this Section 2.12(d) shall apply to the Replacement Letter of Credit mutatis mutandisAgreement. (e) The Parties agree that the Escrow Agreement shall treat the Escrow Letter of Credit and any funds held in the Indemnity Escrow Account as owned by the Partnership for U.S. federal income tax purposes.

Appears in 1 contract

Samples: Merger Agreement (Atrium Companies Inc)

Indemnification Escrow. (a) The Escrow Deposit Amount, or from and after As security for the Closing the Remaining Escrow Deposit Amount, shall (subject to the terms and conditions of Article 6) serve as and be the sole and exclusive source for payment of claims for indemnification by any Purchaser Indemnitee an Indemnification Obligation of the Sellers arising pursuant to Article 6. The an Indemnification Claim, the Sellers authorize the Buyer to hold and deliver as Escrow Letter of Credit, which shall be provided at Agent the Closing by Purchaser Escrowed Shares pursuant to the Escrow Agent Agreement in respect the form of Exhibit A attached hereto. The Buyer is authorized to (i) withdraw from the Seller's portion of the Escrowed Funds described therein, if any, such amount and (ii) withdraw and cancel from the Seller's portion of the Escrowed Shares such number of Escrowed Shares based on the Escrow Deposit AmountShare Indemnification Value needed to satisfy the Indemnification Obligation of the Seller. In the event all the Escrowed Shares and Escrowed Funds have not been delivered in satisfaction of Indemnification Obligations of the Sellers, on a date which is the corresponding date in the twelfth month following the Closing Date, the Buyer as Escrow Agent shall deliver to each Seller such Seller's Portion of the Escrowed Shares and Escrowed Funds which based on the Escrow Share Indemnification Value as of such date are not reserved to satisfy Indemnification Obligations which may arise from outstanding Indemnification Claims of the Buyer as of such date. The Escrowed Shares and Escrowed Funds so reserved, if any, shall be held delivered to the Buyer or the Sellers within five business days following the final determination as to the Indemnification Claims outstanding. To the extent an Indemnification Obligation of a Seller can not be satisfied by the Escrow Agent in an account (delivery of the “Indemnity Escrow Account”) in accordance with the terms Escrowed Shares and conditions of an escrow agreement in the form attached hereto as Exhibit G (the “Escrow Agreement”). (b) On the date which is twelve (12) months following the ClosingEscrowed Funds, the Escrow Agent shall Seller agrees to pay and disburse the balance to the Partnership, via a draw on the funds available under the Escrow Letter of Credit, the Initial Indemnity Release Amount calculated in accordance with Section 2.13, and the amount available to be drawn under the Escrow Letter of Credit and the aggregate principal amount Buyer within ten days of the Escrow Letter determination of Credit shall be reduced to reflect the foregoing draw and payment. (c) Notwithstanding anything in this Agreement his or in the Escrow Agreement to the contrary, in the event that the Partnership is entitled, pursuant to this Agreement and the Escrow Agreement, to funds to be drawn from the Escrow Letter of Credit and the Escrow Agent is not able to draw all or any part of such funds from the Escrow Letter of Credit after receiving a notice (formatted as a joint written instruction) directing it to draw and release such funds, whether due to the expiration of the Escrow Letter of Credit, technical draw issues or otherwise, then, and in any such event, Purchaser shall deliver to the Partnership, her Indemnification Obligation by wire transfer of immediately available immediate funds, not later than three (3) business days (with time of the essence) after a written request therefor from the Partnership, the amount of funds to which the Partnership is entitled or, if less than such amount, the remaining amount available to be drawn under the Escrow Letter of Credit, and the amount available to be drawn thereafter under the Escrow Letter of Credit (if not already equal to Zero) shall be reduced by the amount of such wire transfer. Without limiting the forgoing, any inability of the Escrow Agent to draw upon the Escrow Letter of Credit for any amount that is properly payable to the Partnership from the Escrow Letter of Credit or the Indemnity Escrow Account pursuant to this Agreement and the Escrow Agreement shall not relieve the Purchaser from its obligation to have made or to make such payment to the Partnership, and the Purchaser shall effect such payment by wire transfer in accordance with the preceding sentence. (d) If either Purchaser or the Partnership anticipates that there will be any funds remaining under the Escrow Letter of Credit as of the expiration date of the Escrow Letter of Credit (the “Escrow L/C Expiration”), then Purchaser shall use reasonable best efforts to obtain and deliver to the Escrow Agent, at least three (3) business days prior to the Escrow L/C Expiration, a replacement clean, irrevocable and unconditional standby letter of credit in the aggregate face amount equal to the amount of funds remaining under the Escrow Letter of Credit (i) in substantially the same form as the Escrow Letter of Credit or such other form as is reasonably acceptable to the Partnership and the Escrow Agent and (ii) from the then-current lender under the Escrow Letter of Credit or such other lender as is reasonably acceptable to the Partnership (the “Replacement Letter of Credit”). The Escrow Agreement shall provide that if the Escrow Agent has not received a Replacement Letter of Credit from Purchaser and written notice from the Partnership that the Replacement Letter of Credit satisfies the requirements of this Section 2.12(d) at least six (6) business days prior to the Escrow L/C Expiration, then prior to the close of business on the third (3rd) business day prior to the Escrow L/C Expiration (with time of the essence), the Escrow Agent shall draw all funds remaining under the Escrow Letter of Credit and hold such funds in the Indemnity Escrow Account for release pursuant to the applicable provisions of the Escrow Agreement (a “Full Draw Event”). Following the expiration of the Escrow Letter of Credit, all references in this Agreement and the Escrow Agreement to the Escrow Letter of Credit shall be deemed to refer to the Replacement Letter of Credit (and any subsequent replacement standby letter of credit that complies with this Section 2.12(d)), and this Section 2.12(d) shall apply to the Replacement Letter of Credit mutatis mutandis. (e) The Parties agree that the Escrow Agreement shall treat the Escrow Letter of Credit and any funds held in the Indemnity Escrow Account as owned by the Partnership for U.S. federal income tax purposes.)

Appears in 1 contract

Samples: Stock Purchase Agreement (Scientific Industries Inc)

Indemnification Escrow. At the Closing, in accordance with Section 1.6(b), Buyer shall pay the Escrow Amount to the Escrow Agent, under the Escrow Agreement. The Escrow Amount, together with any interest and income earned on the Escrow Amount (collectively, the “Escrow Funds”), will be held until January 1, 2020 (the “Escrow Period”) to serve as an escrow fund for any indemnifiable Losses of a Buyer Indemnitee pursuant to ARTICLE VII. Interest and income earned, if any, on the Escrow Funds shall be applied first to satisfy any fees and expenses of the Escrow Agent under the Escrow Agreement. At the end of the Escrow Period, the remaining amount of the Escrow Funds, less: (a) The Escrow Deposit Amount, or from and after the Closing the Remaining Escrow Deposit Amount, shall (any amounts subject to the terms any then pending indemnification claim of any Buyer Indemnitee given in accordance with ARTICLE VII; and conditions (b) any then outstanding fees and expenses of Article 6) serve as and be the sole and exclusive source for payment of claims for indemnification by any Purchaser Indemnitee pursuant to Article 6. The Escrow Letter of Credit, which shall be provided at the Closing by Purchaser to the Escrow Agent (but not in respect excess of the interest and income earned, if any, on the Escrow Funds that are then held as part of the Escrow Deposit AmountFunds), shall be held disbursed by the Escrow Agent in an account (the “Indemnity Escrow Account”) to Seller, in accordance with the terms and conditions of an escrow agreement in the form attached hereto as Exhibit G (the “Escrow Agreement”). (b) On the date which is twelve (12) months following the Closing, . Any such amounts withheld by the Escrow Agent shall pay and disburse to the Partnership, via a draw on the funds available under the Escrow Letter thereafter be disbursed upon receipt of Credit, the Initial Indemnity Release Amount calculated in accordance with Section 2.13, and the amount available to be drawn under the Escrow Letter of Credit and the aggregate principal amount of the Escrow Letter of Credit shall be reduced to reflect the foregoing draw and payment. (c) Notwithstanding anything in this Agreement or in the Escrow Agreement to the contrary, in the event that the Partnership is entitled, pursuant to this Agreement and the Escrow Agreement, to funds to be drawn from the Escrow Letter of Credit and the Escrow Agent is not able to draw all or any part of such funds from the Escrow Letter of Credit after receiving a notice (formatted as a joint written instruction) directing it to draw instructions of Buyer and release such fundsSeller or a final, whether due to the expiration non-appealable order, judgment, or decree entered by an arbitral tribunal or court of the Escrow Letter of Credit, technical draw issues or otherwise, then, and in any such event, Purchaser shall deliver to the Partnership, by wire transfer of immediately available funds, not later than three (3) business days (with time of the essence) after a written request therefor from the Partnership, the amount of funds to which the Partnership is entitled or, if less than such amount, the remaining amount available to be drawn under the Escrow Letter of Credit, and the amount available to be drawn thereafter under the Escrow Letter of Credit (if not already equal to Zero) shall be reduced by the amount of such wire transfer. Without limiting the forgoing, any inability of the Escrow Agent to draw upon the Escrow Letter of Credit for any amount that is properly payable to the Partnership from the Escrow Letter of Credit or the Indemnity Escrow Account pursuant to this Agreement and the Escrow Agreement shall not relieve the Purchaser from its obligation to have made or to make such payment to the Partnership, and the Purchaser shall effect such payment by wire transfer in accordance with the preceding sentencecompetent jurisdiction. (d) If either Purchaser or the Partnership anticipates that there will be any funds remaining under the Escrow Letter of Credit as of the expiration date of the Escrow Letter of Credit (the “Escrow L/C Expiration”), then Purchaser shall use reasonable best efforts to obtain and deliver to the Escrow Agent, at least three (3) business days prior to the Escrow L/C Expiration, a replacement clean, irrevocable and unconditional standby letter of credit in the aggregate face amount equal to the amount of funds remaining under the Escrow Letter of Credit (i) in substantially the same form as the Escrow Letter of Credit or such other form as is reasonably acceptable to the Partnership and the Escrow Agent and (ii) from the then-current lender under the Escrow Letter of Credit or such other lender as is reasonably acceptable to the Partnership (the “Replacement Letter of Credit”). The Escrow Agreement shall provide that if the Escrow Agent has not received a Replacement Letter of Credit from Purchaser and written notice from the Partnership that the Replacement Letter of Credit satisfies the requirements of this Section 2.12(d) at least six (6) business days prior to the Escrow L/C Expiration, then prior to the close of business on the third (3rd) business day prior to the Escrow L/C Expiration (with time of the essence), the Escrow Agent shall draw all funds remaining under the Escrow Letter of Credit and hold such funds in the Indemnity Escrow Account for release pursuant to the applicable provisions of the Escrow Agreement (a “Full Draw Event”). Following the expiration of the Escrow Letter of Credit, all references in this Agreement and the Escrow Agreement to the Escrow Letter of Credit shall be deemed to refer to the Replacement Letter of Credit (and any subsequent replacement standby letter of credit that complies with this Section 2.12(d)), and this Section 2.12(d) shall apply to the Replacement Letter of Credit mutatis mutandis. (e) The Parties agree that the Escrow Agreement shall treat the Escrow Letter of Credit and any funds held in the Indemnity Escrow Account as owned by the Partnership for U.S. federal income tax purposes.

Appears in 1 contract

Samples: Asset Purchase Agreement (Cryoport, Inc.)

Indemnification Escrow. (a) The Escrow Deposit Amount, or from and after On the Closing Date, each of Parent and the Remaining Sellers' Representative shall execute and deliver an escrow agreement in substantially the form attached hereto as Exhibit B-2 (the "Indemnification Escrow Deposit AmountAgreement"). On the Closing Date, Parent shall (subject deposit with the Escrow Agent a portion of the Total Transaction Consideration otherwise payable to the terms and conditions of Article 6) serve as and be the sole and exclusive source for payment of claims for indemnification by any Purchaser Indemnitee pursuant to Article 6. The Escrow Letter of Credit, which shall be provided Sellers at the Closing by Purchaser equal to $91,500,000 (the "Indemnification Escrow"). The Indemnification Escrow Agent in respect of the Escrow Deposit Amount, shall be held by the Escrow Agent in an account pursuant to the terms of the Indemnification Escrow Agreement. Pursuant to the Indemnification Escrow Agreement, the Indemnification Escrow shall be released by the Escrow Agent as follows: (i) On the first anniversary of the Closing Date (the “Indemnity Escrow Account”) "First Release Date"), in accordance with the terms and conditions of an escrow agreement in the form attached hereto as Exhibit G (the “Indemnification Escrow Agreement”). (b) On the date which is twelve (12) months following the Closing, the Escrow Agent shall release from the Indemnification Escrow and pay and disburse to the Partnership, via a draw on Sellers' Representative an amount equal to seventy-five percent (75%) of the funds available under the Indemnification Escrow Letter minus any amounts of Credit, the Initial Indemnity Release Amount calculated in accordance with Section 2.13, and the amount available any indemnity claims made pursuant to Article IX (whether or not such indemnity claims have been determined to be drawn under valid) as of such First Release Date, which amount shall be distributed by the Escrow Letter of Credit and Sellers' Representative to the aggregate principal amount Sellers on an equal per share basis; and (ii) On the second anniversary of the Escrow Letter of Credit shall be reduced to reflect Closing Date (the foregoing draw and payment. (c) Notwithstanding anything in this Agreement or in the Escrow Agreement to the contrary"Second Release Date"), in the event that the Partnership is entitled, pursuant to this Agreement and the Escrow Agreement, to funds to be drawn from the Escrow Letter of Credit and the Escrow Agent is not able to draw all or any part of such funds from the Escrow Letter of Credit after receiving a notice (formatted as a joint written instruction) directing it to draw and release such funds, whether due to the expiration of the Escrow Letter of Credit, technical draw issues or otherwise, then, and in any such event, Purchaser shall deliver to the Partnership, by wire transfer of immediately available funds, not later than three (3) business days (with time of the essence) after a written request therefor from the Partnership, the amount of funds to which the Partnership is entitled or, if less than such amount, the remaining amount available to be drawn under the Escrow Letter of Credit, and the amount available to be drawn thereafter under the Escrow Letter of Credit (if not already equal to Zero) shall be reduced by the amount of such wire transfer. Without limiting the forgoing, any inability of the Escrow Agent to draw upon the Escrow Letter of Credit for any amount that is properly payable to the Partnership from the Escrow Letter of Credit or the Indemnity Escrow Account pursuant to this Agreement and the Escrow Agreement shall not relieve the Purchaser from its obligation to have made or to make such payment to the Partnership, and the Purchaser shall effect such payment by wire transfer in accordance with the preceding sentence. (d) If either Purchaser or the Partnership anticipates that there will be any funds remaining under the Escrow Letter of Credit as terms of the expiration date of the Indemnification Escrow Letter of Credit (the “Escrow L/C Expiration”), then Purchaser shall use reasonable best efforts to obtain and deliver to the Escrow Agent, at least three (3) business days prior to the Escrow L/C Expiration, a replacement clean, irrevocable and unconditional standby letter of credit in the aggregate face amount equal to the amount of funds remaining under the Escrow Letter of Credit (i) in substantially the same form as the Escrow Letter of Credit or such other form as is reasonably acceptable to the Partnership and the Escrow Agent and (ii) from the then-current lender under the Escrow Letter of Credit or such other lender as is reasonably acceptable to the Partnership (the “Replacement Letter of Credit”). The Escrow Agreement shall provide that if the Escrow Agent has not received a Replacement Letter of Credit from Purchaser and written notice from the Partnership that the Replacement Letter of Credit satisfies the requirements of this Section 2.12(d) at least six (6) business days prior to the Escrow L/C Expiration, then prior to the close of business on the third (3rd) business day prior to the Escrow L/C Expiration (with time of the essence)Agreement, the Escrow Agent shall draw release and pay to the Sellers' Representative all funds remaining under the Escrow Letter of Credit and hold such funds amounts then contained in the Indemnity Indemnification Escrow Account for release minus any amounts of any indemnity claims made pursuant to Article IX (whether or not such indemnity claims have been determined to be valid) as of such Second Release Date, which amount shall be distributed by the applicable provisions Sellers' Representative to the Sellers on an equal per share basis. To the extent the Sellers' Representative disagrees with the amounts determined under clauses (i) and (ii), the dispute shall be submitted to mediation pursuant to Section 9.5. A portion of the Escrow Agreement (a “Full Draw Event”). Following the expiration balance of the amounts remaining in the Indemnification Escrow Letter shall be paid to the Sellers' Representative as each claim remaining after the Second Release Date is resolved, with the portion to be repaid being equal to the amount retained in the Indemnification Escrow in respect of Creditthe resolved claim. At such time as all remaining claims have been resolved, all references remaining amounts in this Agreement the Indemnification Escrow shall be released and the Escrow Agreement paid to the Escrow Letter of Credit shall be deemed to refer to the Replacement Letter of Credit (and any subsequent replacement standby letter of credit that complies with this Section 2.12(d)), and this Section 2.12(d) shall apply to the Replacement Letter of Credit mutatis mutandisSellers' Representative. (e) The Parties agree that the Escrow Agreement shall treat the Escrow Letter of Credit and any funds held in the Indemnity Escrow Account as owned by the Partnership for U.S. federal income tax purposes.

Appears in 1 contract

Samples: Stock Purchase Agreement (Horseshoe Gaming Holding Corp)

Indemnification Escrow. (a) The Escrow Deposit Amount, or from and after the Closing the Remaining Escrow Deposit Amount, shall (subject to the terms and conditions of Article 6) serve as and be the sole and exclusive source for payment of claims for indemnification by any Purchaser Indemnitee pursuant to Article 6. The Escrow Letter of Credit, which shall be provided at the Closing by Purchaser to the Escrow Agent in respect of the Escrow Deposit Amount, shall be held by the Escrow Agent in an account (the “Indemnity Escrow Account”) in accordance with the terms and conditions of an escrow agreement in the form attached hereto as Exhibit G (the “Escrow Agreement”). (b) On the date which is twelve (12) months following the Closing, the Escrow Agent shall pay and disburse to the Partnership, via a draw on the funds available under the Escrow Letter of Credit, the Initial Indemnity Release Amount calculated in accordance with Section 2.13, and the amount available to be drawn under the Escrow Letter of Credit and the aggregate principal amount of the Escrow Letter of Credit shall be reduced to reflect Notwithstanding the foregoing draw and payment. (c) Notwithstanding anything in provisions of this Agreement or in the Escrow Agreement Article I to the contrary, in on the event that Closing Date, the Partnership is entitled, pursuant to this Agreement and the Escrow Agreement, to funds to be drawn from the Escrow Letter of Credit and the Escrow Agent is not able to draw all or any part of such funds from the Escrow Letter of Credit after receiving a notice (formatted as a joint written instruction) directing it to draw and release such funds, whether due to the expiration Stock Portion of the Merger Consideration (the “Indemnification Escrow Letter of Credit, technical draw issues or otherwise, then, and in any such event, Purchaser shall deliver to the Partnership, by wire transfer of immediately available funds, not later than three (3) business days (with time of the essence) after a written request therefor from the Partnership, the amount of funds to which the Partnership is entitled or, if less than such amount, the remaining amount available to be drawn under the Escrow Letter of Credit, and the amount available to be drawn thereafter under the Escrow Letter of Credit (if not already equal to ZeroAmount”) shall be reduced delivered by the amount of such wire transfer. Without limiting the forgoing, any inability of the Escrow Agent to draw upon the Escrow Letter of Credit for any amount that is properly payable to the Partnership from the Escrow Letter of Credit or the Indemnity Escrow Account pursuant to this Agreement and the Escrow Agreement shall not relieve the Purchaser from its obligation to have made or to make such payment to the Partnership, and the Purchaser shall effect such payment by wire transfer in accordance with the preceding sentence. (d) If either Purchaser or the Partnership anticipates that there will be any funds remaining under the Escrow Letter of Credit as of the expiration date of the Escrow Letter of Credit (the “Escrow L/C Expiration”), then Purchaser shall use reasonable best efforts to obtain and deliver Acquiror to the Escrow Agent, at least three to be held in escrow (3i) business days as security for the indemnification obligations in favor of Acquiror under Article XIII pursuant to the provisions of an escrow agreement (the “Indemnification Escrow Agreement”) to be entered into by and among Acquiror, the Holder Representative and the Escrow Agent in a form to be agreed upon between the date hereof and the Closing Date by Acquiror, the Company and the Escrow Agent, which form of agreement shall reflect the terms summarized on Annex C-2 attached hereto, and (ii) to provide security for amount payable to the Acquiror pursuant to Section 1.5(d) hereof but only to the extent provided in Section 1.5(d). At any time during the Escrow Period, the Holder Representative may elect to remove any of the shares of Acquiror Common Stock from such escrow and replace each such removed share with cash in an amount equal to the Closing Stock Price for such share. Within five (5) Business Days of the date that is the first anniversary of the Closing Date (the “Escrow Termination Date”), each of Acquiror and the Holder Representative shall execute joint written instructions to the Escrow Agent instructing the Escrow Agent to disburse the balance of the Indemnification Escrow Amount (less the aggregate amount of all claims for indemnification asserted in writing by the Purchaser Indemnitees prior to the Escrow L/C Expiration, a replacement clean, irrevocable and unconditional standby letter of credit in the aggregate face amount equal Termination Date pursuant to Article XIII hereof to the amount of funds remaining under the Escrow Letter of Credit (i) in substantially the same form as the Escrow Letter of Credit extent not paid or such other form as is reasonably acceptable to the Partnership and the Escrow Agent and (ii) from the then-current lender under the Escrow Letter of Credit or such other lender as is reasonably acceptable to the Partnership (the “Replacement Letter of Credit”). The Escrow Agreement shall provide that if the Escrow Agent has not received a Replacement Letter of Credit from Purchaser and written notice from the Partnership that the Replacement Letter of Credit satisfies the requirements of this Section 2.12(d) at least six (6) business days satisfied prior to the Escrow L/C Expiration, then prior Termination Date) to the close of business on the third (3rd) business day prior to the Escrow L/C Expiration (with time holders of the essenceCommon Shares and Options entitled to receive the Merger Consideration (pro rata, in accordance with their respective Applicable Percentages), the Escrow Agent shall draw all funds remaining under the Escrow Letter of Credit and hold such funds in the Indemnity Escrow Account for release together with any earnings thereon pursuant to the applicable provisions of the Indemnification Escrow Agreement (a “Full Draw Event”). Following the expiration of the Escrow Letter of Credit, all references in this Agreement and the Escrow Agreement to the Escrow Letter of Credit shall be deemed to refer to the Replacement Letter of Credit (and any subsequent replacement standby letter of credit that complies with this Section 2.12(d)), and this Section 2.12(d) shall apply to the Replacement Letter of Credit mutatis mutandisAgreement. (e) The Parties agree that the Escrow Agreement shall treat the Escrow Letter of Credit and any funds held in the Indemnity Escrow Account as owned by the Partnership for U.S. federal income tax purposes.

Appears in 1 contract

Samples: Merger Agreement (Encore Medical Corp)

Indemnification Escrow. (a) The Escrowed Amount shall be deposited into escrow with the Escrow Deposit Amount, or from Agent and after the Closing the Remaining Escrow Deposit Amount, shall (subject to the terms and conditions of Article 6) serve as and be the sole and exclusive source for payment of claims for indemnification by any Purchaser Indemnitee pursuant to Article 6. The Escrow Letter of Credit, which shall be provided at the Closing by Purchaser to the Escrow Agent in respect of the Escrow Deposit AmountAgreement and this Agreement and remain in escrow until the eighteen (18) month anniversary of the Closing Date (the "Indemnity Release Date") or until it is paid to a Parent Indemnitee; provided, that upon the Indemnity Release Date, an amount equal to the difference between (a) the remainder of the Escrowed Amount and (b) the then-applicable Reserve Amount shall be held promptly released by the Escrow Agent in an account (the “Indemnity Escrow Account”) in accordance with pursuant to the terms and conditions of an escrow agreement in the form attached hereto as Exhibit G (the “Escrow Agreement”). (b) On the date which is twelve (12) months following the Closing, the Escrow Agent shall pay and disburse to the Partnership, via a draw on the funds available under the Escrow Letter of Credit, the Initial Indemnity Release Amount calculated in accordance with Section 2.13, and the amount available to be drawn under the Escrow Letter of Credit and the aggregate principal amount of the Escrow Letter of Credit shall be reduced to reflect the foregoing draw and payment. (c) Notwithstanding anything in this Agreement or in the Escrow Agreement to the contraryholders of Company Capital Stock in accordance with this Agreement. Notwithstanding the foregoing, in however, the event that Dissenting Shares Escrow Amount shall be segregated from the Partnership is entitled, pursuant to this Agreement remainder of the Escrowed Amount and the Escrow Agreement, to funds to shall be drawn released from the Escrow Letter Fund from time to time only as follows: (i) with respect to Non-Consenting Stockholders that have not exercised Appraisal Rights within twenty one (21) days following the date of Credit and mailing of the Escrow Agent is not able Company's notice of approval of the Merger to draw all or any part each of the holders of Company Capital Stock (the "Appraisal Right Determination Date"), 150% of the aggregate amount of consideration attributable to the shares of Company Capital Stock held by such funds Non-Consenting Stockholders immediately prior to the Effective Time shall be released from the Escrow Letter Fund, 100% of Credit after receiving a notice (formatted as a joint written instruction) directing it such aggregate amount shall be distributed to draw such Non-Consenting Stockholders on the Appraisal Right Determination Date and release the remaining 50% of such funds, whether due aggregate amount shall be released on such date to the expiration holders of the Escrow Letter Company Capital Stock in accordance with this Agreement; and (ii) with respect to any Dissenting Stockholder, 150% of Credit, technical draw issues or otherwise, then, and in any such event, Purchaser shall deliver to the Partnership, by wire transfer of immediately available funds, not later than three (3) business days (with time of the essence) after a written request therefor from the Partnership, the amount of funds consideration attributable to which the Partnership is entitled or, if less than Dissenting Shares held by such amount, Dissenting Stockholder immediately prior to the remaining amount available to be drawn under the Escrow Letter of Credit, and the amount available to be drawn thereafter under the Escrow Letter of Credit (if not already equal to Zero) Effective Time shall be reduced by the amount of such wire transfer. Without limiting the forgoing, any inability of the Escrow Agent to draw upon the Escrow Letter of Credit for any amount that is properly payable to the Partnership released from the Escrow Letter Fund, up to 150% of Credit or such amount shall be distributed to such Dissenting Stockholder upon the Indemnity Escrow Account pursuant to this Agreement date of and the Escrow Agreement shall not relieve the Purchaser from its obligation to have made or to make such payment to the Partnership, and the Purchaser shall effect such payment by wire transfer in accordance with the preceding sentence. (d) If either Purchaser settlement or the Partnership anticipates that there will be any funds remaining final adjudication of all claims of such Dissenting Stockholder made under the Escrow Letter of Credit as Section 262 of the expiration DGCL and the remainder of such amount (if any) shall be released on such date to the holders of Company Capital Stock in accordance with this Agreement. If a Dissenting Stockholder withdraws its demand for Appraisal Rights in accordance with Section 262 of the Escrow Letter of Credit (the “Escrow L/C Expiration”)DGCL, then Purchaser shall use reasonable best efforts to obtain and deliver 150% of the amount of consideration attributable to the Escrow Agent, at least three (3) business days Dissenting Shares held by such Dissenting Stockholder immediately prior to the Effective Time shall be released from the Escrow L/C ExpirationFund within five (5) Business Days of the withdrawal of such demand, a replacement clean, irrevocable 100% of such amount shall be distributed to such Non-Consenting Stockholders on the date of such release and unconditional standby letter the remaining 50% of credit in the aggregate face such amount equal shall be distributed to the amount holders of funds remaining under the Escrow Letter of Credit (i) in substantially the same form as the Escrow Letter of Credit or such other form as is reasonably acceptable to the Partnership and the Escrow Agent and (ii) from the then-current lender under the Escrow Letter of Credit or such other lender as is reasonably acceptable to the Partnership (the “Replacement Letter of Credit”). The Escrow Agreement shall provide that if the Escrow Agent has not received a Replacement Letter of Credit from Purchaser and written notice from the Partnership that the Replacement Letter of Credit satisfies the requirements of this Section 2.12(d) at least six (6) business days prior to the Escrow L/C Expiration, then prior to the close of business Company Capital Stock on the third (3rd) business day prior to the Escrow L/C Expiration (with time date of the essence), the Escrow Agent shall draw all funds remaining under the Escrow Letter of Credit and hold such funds release in the Indemnity Escrow Account for release pursuant to the applicable provisions of the Escrow Agreement (a “Full Draw Event”). Following the expiration of the Escrow Letter of Credit, all references in this Agreement and the Escrow Agreement to the Escrow Letter of Credit shall be deemed to refer to the Replacement Letter of Credit (and any subsequent replacement standby letter of credit that complies accordance with this Section 2.12(d)), and this Section 2.12(d) shall apply to the Replacement Letter of Credit mutatis mutandisAgreement. (e) The Parties agree that the Escrow Agreement shall treat the Escrow Letter of Credit and any funds held in the Indemnity Escrow Account as owned by the Partnership for U.S. federal income tax purposes.

Appears in 1 contract

Samples: Merger Agreement (Viisage Technology Inc)

Indemnification Escrow. (a) The Escrow Deposit AmountAt the Closing, or from and after an amount equal to $600,000.00 of the Closing the Remaining Escrow Deposit Amount, shall (subject to the terms and conditions of Article 6) serve as and be the sole and exclusive source for payment of claims for indemnification by any Purchaser Indemnitee pursuant to Article 6. The Escrow Letter of Credit, which Asset Purchase Price shall be provided at the Closing by Purchaser withheld and delivered to the Escrow Agent and deposited in respect escrow by the Purchaser (the “Indemnification Escrow Amount”), to be held for a period of 24 months following the Closing Date (the “Indemnification Escrow Period”) to secure the Seller’s indemnification obligations under this Section 6.2. The Escrow Agent shall deposit the Indemnification Escrow Amount in a non-interest-bearing account to be held in accordance with the form of escrow agreement (“Indemnification Escrow Agreement”) attached hereto as Exhibit M. (i) 50% of the Indemnification Escrow Deposit Amount, Amount shall be held released and paid by the Escrow Agent in an account to the Seller on the 1st anniversary of the Closing Date (the “Indemnity Escrow Account”) in accordance with the terms and conditions of an escrow agreement in the form attached hereto as Exhibit G (the “Escrow AgreementFirst Release”). (b) On the date which is twelve (12) months following the Closing; provided, however, the Escrow Agent shall pay and disburse to the Partnership, via a draw on the funds available under the Escrow Letter of Credit, the Initial Indemnity First Release Amount calculated in accordance with Section 2.13, and the amount available to be drawn under the Escrow Letter of Credit and the aggregate principal amount of the Escrow Letter of Credit shall be reduced to reflect the foregoing draw and payment. (c) Notwithstanding anything in this Agreement or in the Escrow Agreement to the contrary, in the event that the Partnership is entitled, pursuant to this Agreement and the Escrow Agreement, to funds to be drawn from the Escrow Letter of Credit and the Escrow Agent is not able to draw all or any part of such funds from the Escrow Letter of Credit after receiving a notice (formatted as a joint written instruction) directing it to draw and release such funds, whether due to the expiration of the Escrow Letter of Credit, technical draw issues or otherwise, then, and in any such event, Purchaser shall deliver to the Partnership, by wire transfer of immediately available funds, not later than three (3) business days (with time of the essence) after a written request therefor from the Partnership, the amount of funds to which the Partnership is entitled or, if less than such amount, the remaining amount available to be drawn under the Escrow Letter of Credit, and the amount available to be drawn thereafter under the Escrow Letter of Credit (if not already equal to Zero) shall be reduced by any amounts either (A) paid to a Purchaser Indemnified Party from the amount Indemnification Escrow Amount, or (B) subject to a disputed claim as of such wire transfer. Without limiting the forgoing, any inability date of the First Release. (ii) The remaining portion of the Indemnification Escrow Amount shall be released and paid by the Escrow Agent to draw upon the Escrow Letter Seller on the 2nd anniversary of Credit for the Closing Date (the “Second Release”); provided, however, the Second Release shall be reduced by any amount that is properly payable amounts either (A) paid to the Partnership a Purchaser Indemnified Party from the Indemnification Escrow Letter Amount, or (B) subject to a disputed claim as of Credit or the Indemnity Escrow Account pursuant to this Agreement and date of the Escrow Agreement shall not relieve the Purchaser from its obligation to have made or to make such payment to the Partnership, and the Purchaser shall effect such payment by wire transfer in accordance with the preceding sentenceSecond Release. (diii) If either the Seller receives notice from the Purchaser or of a request for indemnification during the Partnership anticipates that there will be any funds remaining under the Indemnification Escrow Letter of Credit as of the expiration date of the Escrow Letter of Credit (the “Escrow L/C Expiration”), then Purchaser shall use reasonable best efforts to obtain and deliver to the Escrow Agent, at least three (3) business days prior to the Escrow L/C Expiration, a replacement clean, irrevocable and unconditional standby letter of credit in the aggregate face amount equal to the amount of funds remaining under the Escrow Letter of Credit (i) in substantially the same form as the Escrow Letter of Credit or such other form as is reasonably acceptable to the Partnership Period and the Escrow Agent and (ii) from the then-current lender under the Escrow Letter Seller does not dispute its indemnification obligation in connection therewith within 10 Business Days of Credit or such other lender as is reasonably acceptable to the Partnership (the “Replacement Letter of Credit”). The Escrow Agreement shall provide that if the Escrow Agent has not received a Replacement Letter of Credit from Purchaser and receiving written notice from the Partnership that the Replacement Letter of Credit satisfies the requirements of Purchaser as provided below in this Section 2.12(d) at least six (6) business days prior to the Escrow L/C Expiration, then prior to the close of business on the third (3rd) business day prior to the Escrow L/C Expiration (with time of the essence6.2(e)(iii), the Escrow Agent shall draw all funds remaining under Purchaser may, only after complying with the Escrow Letter of Credit and hold such funds procedures described in the Indemnity Indemnification Escrow Account for Agreement, set off the amount owed to it in respect of such indemnification obligation against the Indemnification Escrow Amount. Such amount will reduce the Indemnification Escrow Amount and any corresponding release pursuant owed to the Seller during the applicable provisions period set forth in this Section 6.2(e), or upon termination of the Indemnification Escrow Agreement (a “Full Draw Event”)Period, as the case may be. Following Prior to exercising its right of set-off hereunder, the expiration Purchaser shall notify the Seller in writing of the Escrow Letter of Credit, matter in dispute together with all references in this Agreement material facts and circumstances reasonably necessary for the Escrow Agreement Seller to determine the Escrow Letter of Credit shall be deemed to refer to the Replacement Letter of Credit (and any subsequent replacement standby letter of credit that complies with this Section 2.12(d)), and this Section 2.12(d) shall apply to the Replacement Letter of Credit mutatis mutandisBasis for such claim or asserted obligation. (e) The Parties agree that the Escrow Agreement shall treat the Escrow Letter of Credit and any funds held in the Indemnity Escrow Account as owned by the Partnership for U.S. federal income tax purposes.

Appears in 1 contract

Samples: Asset Purchase Agreement (LMP Automotive Holdings, Inc.)

Indemnification Escrow. (a) The At Closing, Purchaser shall deposit One Million Six Hundred Fifty Thousand Dollars ($1,650,000.00) (the "Escrow Deposit Amount, or from and after the Closing the Remaining Escrow Deposit Amount, shall (subject to the terms and conditions of Article 6") serve as and be the sole and exclusive source for payment of claims for indemnification by any Purchaser Indemnitee into escrow pursuant to Article 6. The Escrow Letter of Credit, which shall be provided at the Closing by Purchaser to the Escrow Agent in respect of Agreement. U.S. Bank, National Association, as the escrow agent (the "Escrow Agent"), shall hold the Escrow Deposit Amount, shall be held by the Escrow Agent Amount and all interest and other amounts earned thereon in an escrow account (the “Indemnity "Escrow Account") for purposes of securing any amounts payable by the Selling Parties on account of any and all indemnification obligations under Section 6.2 hereof and certain other amounts payable hereunder in accordance with this Agreement and the terms Escrow Agreement of even date herewith among Seller, Purchaser and conditions of an escrow agreement in the form attached hereto as Exhibit G Escrow Agent (the "Escrow Agreement"). (b) On A portion of the Escrow Amount equal to Six Hundred Fifty Thousand Dollars ($650,000) (less any amount previously paid from the Escrow Account to Purchaser on account of any Indemnity Claim and less any Continuing Unresolved Amount) shall be released from the Escrow Account and paid over to Seller, by confirmed wire transfer of immediately available funds, on the third (3rd) Business Day following the date which that is twelve (12) months after the Closing Date (the "First Release Date"). The remainder of the funds in the Escrow Account (less any Continuing Unresolved Amount) and any interest accrued thereon shall be released from the Escrow Account and paid over to Seller, by confirmed wire transfer of immediately available funds, on the third (3rd) Business Day following the Closingdate that is eighteen (18) months after the Closing Date (the "Final Release Date" and together with the First Release Date, each a "Release Date"). Any Continuing Unresolved Amount withheld from release after the Escrow Agent shall pay Final Release Date and disburse finally determined not to the Partnership, via a draw on the funds available under the Escrow Letter of Credit, the Initial Indemnity Release Amount calculated be required to be released to Purchaser in accordance with Section 2.13, and the amount available to be drawn under the Escrow Letter of Credit and the aggregate principal amount of the Escrow Letter of Credit shall be reduced to reflect the foregoing draw and payment. (c) Notwithstanding anything in this Agreement or in the Escrow Agreement to the contrary, in the event that the Partnership is entitled, pursuant to this Agreement and the Escrow Agreement, shall be released to funds to be drawn from the Escrow Letter of Credit and the Escrow Agent is not able to draw all or any part of such funds from the Escrow Letter of Credit after receiving a notice (formatted as a joint written instruction) directing it to draw and release such funds, whether due to the expiration of the Escrow Letter of Credit, technical draw issues or otherwise, then, and in any such event, Purchaser shall deliver to the Partnership, Seller by confirmed wire transfer of immediately available funds, not later than funds within three (3) business days Business Days following such determination. (with time c) Purchaser, on one hand, and Seller, on the other hand, shall each pay fifty percent (50%) of the essence) after a written request therefor from the Partnershipfees, the amount of funds to which the Partnership is entitled or, if less than such amount, the remaining amount available to be drawn under expenses and costs associated with establishing and maintaining the Escrow Letter of Credit, and the amount available to be drawn thereafter under the Escrow Letter of Credit (if not already equal to Zero) shall be reduced by the amount of such wire transfer. Without limiting the forgoing, any inability of the Escrow Agent to draw upon the Escrow Letter of Credit for any amount that is properly payable to the Partnership from the Escrow Letter of Credit or the Indemnity Escrow Account pursuant to in accordance with this Agreement and the Escrow Agreement Agreement, provided that the costs of disbursements shall not relieve be paid from the Purchaser from its obligation to have made or to make such payment to the Partnership, and the Purchaser shall effect such payment by wire transfer in accordance with the preceding sentenceEscrow Account. (d) If either Purchaser or the Partnership anticipates that there will be any funds remaining under the Escrow Letter of Credit as of the expiration date of the Escrow Letter of Credit (the “Escrow L/C Expiration”), then Purchaser shall use reasonable best efforts and Seller agree to obtain and deliver to the Escrow Agent, at least three (3) business days prior to the Escrow L/C Expiration, a replacement clean, irrevocable and unconditional standby letter of credit in the aggregate face amount equal to the amount of funds remaining under the Escrow Letter of Credit (i) in substantially the same form as the Escrow Letter of Credit or such other form as is reasonably acceptable to the Partnership and promptly provide the Escrow Agent and with jointly-executed written instructions to disburse or retain the Escrow Amount (iior a portion thereof, as applicable) from the then-current lender under the Escrow Letter of Credit or such other lender as is reasonably acceptable to the Partnership (the “Replacement Letter of Credit”). The Escrow Agreement shall provide that if the Escrow Agent has not received a Replacement Letter of Credit from Purchaser and written notice from the Partnership that the Replacement Letter of Credit satisfies the requirements of this Section 2.12(d) at least six (6) business days prior to the Escrow L/C Expiration, then prior to the close of business on the third (3rd) business day prior to the Escrow L/C Expiration (with time of the essence), the Escrow Agent shall draw all funds remaining under the Escrow Letter of Credit and hold such funds in the Indemnity Escrow Account for release pursuant to the applicable provisions of the Escrow Agreement (a “Full Draw Event”). Following the expiration of the Escrow Letter of Credit, all references in accordance with this Agreement and the Escrow Agreement to the Escrow Letter of Credit shall be deemed to refer to the Replacement Letter of Credit (and any subsequent replacement standby letter of credit that complies with this Section 2.12(d)), and this Section 2.12(d) shall apply to the Replacement Letter of Credit mutatis mutandisAgreement. (e) The Parties agree that the Escrow Agreement shall treat the Escrow Letter of Credit and any funds held in the Indemnity Escrow Account as owned by the Partnership for U.S. federal income tax purposes.

Appears in 1 contract

Samples: Asset Purchase Agreement (Inotiv, Inc.)

Indemnification Escrow. (a) The Escrow Deposit AmountTo the extent that any Parent Indemnified Party is entitled to any indemnification payments, or from and after the Closing the Remaining Escrow Deposit Amount, shall (subject to the terms and conditions of Article 6) serve as and be the sole and exclusive source for payment of claims for such indemnification by any Purchaser Indemnitee pursuant to Article 6. The Escrow Letter of Credit, which payments shall be provided at disbursed to such Parent Indemnified Party by wire transfer of immediately available funds from the Closing by Purchaser to the Escrow Agent in respect of the Escrow Deposit Amount, shall be held by the Escrow Agent in an account (the “Indemnity Indemnification Escrow Account”) in accordance with the terms and conditions of an escrow agreement in the form attached hereto as Exhibit G (the “Escrow Agreement”). (b) On the date which is twelve (12) months following Survival Termination Date, the Closing, parties shall provide a joint written instruction to the Escrow Agent shall pay and disburse to the Partnership, via a draw on the funds available under the Escrow Letter of Credit, the Initial Indemnity Release Amount calculated in accordance with Section 2.13, and the amount available to be drawn under the Escrow Letter of Credit and the aggregate principal amount of the Escrow Letter of Credit shall be reduced to reflect the foregoing draw and payment. (c) Notwithstanding anything in this Agreement or in the Escrow Agreement to the contrary, in the event that the Partnership is entitled, pursuant to this Agreement and the Escrow Agreement, to funds to be drawn deliver promptly from the Indemnification Escrow Letter of Credit and the Escrow Agent is not able to draw all or any part of such funds from the Escrow Letter of Credit after receiving a notice (formatted as a joint written instruction) directing it to draw and release such funds, whether due to the expiration of the Escrow Letter of Credit, technical draw issues or otherwise, then, and in any such event, Purchaser shall deliver to the Partnership, Account by wire transfer of immediately available fundsfunds all or a portion of the cash held in the Indemnification Escrow Account, such that, following such transfer, the amount of cash remaining in the Indemnification Escrow Account equals only the amount, if any, of claims for indemnification under Section 7.03(b) and Section 9.02(a) properly asserted prior to such date by the Parent Indemnified Parties in writing in accordance with Section 7.03 or this Article IX, as applicable, but not later than yet resolved as of the Survival Termination Date (such claims, “Unresolved Claims,” and such amount of funds to be transferred, the “Indemnification Escrow Remainder”). Such joint written instructions to the Escrow Agent shall cause the Escrow Agent to pay to the Representative the Indemnification Escrow Remainder for the benefit of the Securityholders. The Representative shall distribute to each Securityholder its pro rata portion thereof based on its Pro Rata Percentage; provided that to the extent a Securityholder is a holder of In-the-Money Options, the Representative may deposit with the Surviving Company any portion of such amount payable to such holder of In-the-Money Options, and Parent shall cause the Surviving Company, through the Surviving Company’s payroll system, on the first normal payroll date of the Surviving Company following such deposit (and in any event within three (3) business days (with time of Business Days following such deposit), to distribute to each such holder the essence) after a written request therefor amount specified in instructions received from the PartnershipRepresentative and, in such circumstances, the amount of funds distributed to which the Partnership is entitled or, if less than such amount, the remaining amount available to be drawn under the Escrow Letter of Credit, and the amount available to be drawn thereafter under the Escrow Letter of Credit (if not already equal to Zero) other Securityholders shall be reduced by accordingly. Upon final resolution of any Unresolved Claim in respect of which an amounts had been retained (to the amount of such wire transfer. Without limiting extent not utilized to satisfy valid claims for indemnification pursuant to Section 9.02(a)), the forgoing, any inability of parties shall provide a joint written instruction to the Escrow Agent to draw upon deliver such amount promptly from the Indemnification Escrow Account by wire transfer of immediately available funds and such amount shall be deemed to have become Indemnification Escrow Remainder and shall be paid to each Securityholder in accordance with the process set forth in the preceding sentence and the terms of the Escrow Letter Agreement. (c) Promptly upon any Person becoming entitled to release of Credit for any amount that is properly payable to the Partnership amounts from the Escrow Letter of Credit or the Indemnity Indemnification Escrow Account pursuant to Section 7.03(b) or this Agreement and Article IX or the Escrow Agreement Agreement, the parties shall not relieve the Purchaser from its obligation to have made or to make such payment to the Partnership, and the Purchaser shall effect such payment by wire transfer in accordance with the preceding sentence. (d) If either Purchaser or the Partnership anticipates that there will be any funds remaining under the Escrow Letter of Credit as of the expiration date of the Escrow Letter of Credit (the “Escrow L/C Expiration”), then Purchaser shall use reasonable best efforts to obtain and deliver execute joint written instructions to the Escrow Agent, at least three (3) business days prior to the Escrow L/C Expiration, a replacement clean, irrevocable and unconditional standby letter of credit in the aggregate face amount equal to the amount of funds remaining under the Escrow Letter of Credit (i) in substantially the same form as the Escrow Letter of Credit or such other form as is reasonably acceptable to the Partnership and Agent instructing the Escrow Agent and (ii) from the then-current lender under the Escrow Letter of Credit or to so release such other lender as is reasonably acceptable to the Partnership (the “Replacement Letter of Credit”). The Escrow Agreement shall provide that if the Escrow Agent has not received a Replacement Letter of Credit from Purchaser and written notice from the Partnership that the Replacement Letter of Credit satisfies the requirements of this Section 2.12(d) at least six (6) business days prior to the Escrow L/C Expiration, then prior to the close of business on the third (3rd) business day prior to the Escrow L/C Expiration (with time of the essence), the Escrow Agent shall draw all funds remaining under the Escrow Letter of Credit and hold such funds in the Indemnity Escrow Account for release pursuant to the applicable provisions of the Escrow Agreement (a “Full Draw Event”). Following the expiration of the Escrow Letter of Credit, all references in this Agreement and the Escrow Agreement to the Escrow Letter of Credit shall be deemed to refer to the Replacement Letter of Credit (and any subsequent replacement standby letter of credit that complies with this Section 2.12(d)), and this Section 2.12(d) shall apply to the Replacement Letter of Credit mutatis mutandisamounts. (e) The Parties agree that the Escrow Agreement shall treat the Escrow Letter of Credit and any funds held in the Indemnity Escrow Account as owned by the Partnership for U.S. federal income tax purposes.

Appears in 1 contract

Samples: Merger Agreement (XPO Logistics, Inc.)

Indemnification Escrow. Notwithstanding anything to the contrary in this Agreement: (a) The Escrow Deposit Amount, or from and after Parent shall initially withhold an aggregate of twenty percent (20%) of the Closing the Remaining Escrow Deposit Amount, shall (subject to the terms and conditions of Article 6) serve as and be the sole and exclusive source for payment of claims for indemnification by any Purchaser Indemnitee pursuant to Article 6. The Escrow Letter of CreditMerger Consideration, which shall be provided at the Closing by Purchaser to the Escrow Agent in respect is 500 shares of the Escrow Deposit Amount, shall be held by the Escrow Agent in an account Parent Preferred Stock (the “Indemnity Escrow AccountIndemnification Holdback) in accordance with the terms and conditions of an escrow agreement ), in the form attached hereto as amounts set forth opposite each Securityholder’s name on Exhibit G (the “Escrow Agreement”).B. (b) On If a Parent Indemnitee determines in good faith that it is entitled to indemnification for Damages pursuant to ARTICLE VIII below, Parent shall deliver to the date Controlling Securityholders a written request for the payment of the amount of such Damages (a “Payment Request”), which is twelve (12) months following Payment Request shall identify in reasonable detail the Closingfacts and circumstances with respect to the subject matter of such Damages, the Escrow Agent section of this Agreement for which indemnification is sought and the amount and method of computing the amount of Damages. Within twenty (20) days after the Controlling Securityholders receive a Payment Request, the Controlling Securityholders shall pay and disburse deliver to Parent a written notice (a “Response Notice”) stating whether or not the Controlling Securityholders object to the Partnership, via payment of all or any portion of the Damages amount set forth in the Payment Request. In the event the Controlling Securityholders do not deliver a draw on the funds available under the Escrow Letter Response Notice within twenty (20) days after receipt of Credita Payment Request, the Initial Indemnity Release Amount Controlling Securityholders will be deemed not to have objected to any portion of the Damages amount set forth in the Payment Request and Parent shall deduct such Damages amount from the Indemnification Holdback pursuant to Section 2.5(c) below. Parent will be prohibited from deducting any Damages amount in dispute as set forth in the Response Notice, unless (i) the Controlling Securityholders deliver a written notice (an “Amended Response Notice”) to Parent stating they have withdrawn the objection with respect to all or any part of the objections set forth in the Response Notice, or (ii) Parent delivers to the Controlling Securityholders a copy of a final, non-appealable order of a court of competent jurisdiction (a “Final Order”) determining that the Parent Indemnitee is entitled to payment of such Damages amount under this Agreement. Upon receipt of an Amended Response Notice from the Controlling Securityholders or a Final Order not appealed and bonded, as applicable, Parent shall thereafter act in accordance with Section 2.5(c) below. (c) If Parent has received a Response Notice (or fails to receive a Response Notice as specified above) or an Amended Response Notice or has obtained a Final Order, and if such Response Notice (or Payment Request in the event Parent has not received a Response Notice as specified above), Amended Response Notice or Final Order indicates that a Parent Indemnitee is entitled to payment in respect of all or any portion of Damages amount set forth in a Payment Request, then Parent may deduct from the Indemnification Holdback an amount equal to the amount due to the Parent Indemnitee as indicated in such Response Notice (or Payment Request in the event Parent has not received a Response Notice as specified above), Amended Response Notice, or Final Order (the “Final Claim Amount”) as calculated in accordance with Section 2.132.5(d) below and such amount will be deducted from the Indemnification Holdback Consideration. If such Response Notice, and Amended Response Notice or Final Order indicates that the amount available Parent Indemnitee is not entitled to be drawn under the Escrow Letter of Credit and the aggregate principal amount all or any portion of the Escrow Letter of Credit shall be reduced to reflect the foregoing draw and payment. (c) Notwithstanding anything in this Agreement or Damages amount set forth in the Escrow Agreement Payment Request, then Parent shall not deduct such shares from the Indemnification Holdback until such amounts are distributed to the contrary, any Parent Indemnitee in the event that the Partnership is entitled, respect of another Payment Request pursuant to this Agreement and the Escrow AgreementSection 2.5(c) or, subject to funds to be drawn from the Escrow Letter of Credit and the Escrow Agent is not able to draw all or any part of such funds from the Escrow Letter of Credit after receiving a notice (formatted as a joint written instruction) directing it to draw and release such funds, whether due to the expiration of the Escrow Letter of Credit, technical draw issues or otherwise, then, and in any such event, Purchaser shall deliver to the Partnership, by wire transfer of immediately available funds, not later than three (3) business days (with time of the essence) after a written request therefor from the PartnershipSection 2.5(e), the amount of funds to which the Partnership is entitled or, if less than such amount, the remaining amount available to be drawn under the Escrow Letter of Credit, and the amount available to be drawn thereafter under the Escrow Letter of Credit (if not already equal to Zero) shall be reduced by the amount of such wire transfer. Without limiting the forgoing, any inability of the Escrow Agent to draw upon the Escrow Letter of Credit for any amount that is properly payable to the Partnership from the Escrow Letter of Credit or the Indemnity Escrow Account pursuant to this Agreement and the Escrow Agreement shall not relieve the Purchaser from its obligation to have made or to make such payment to the Partnership, and the Purchaser shall effect such payment by wire transfer in accordance with the preceding sentenceIndemnification Expiration Date. (d) If either Purchaser or For purposes of determining the Partnership anticipates that there will number of shares of Parent Preferred Stock to be any funds remaining under deducted from the Escrow Letter of Credit as Indemnification Holdback pursuant to this Section 2.5, Parent shall divide the amount of the expiration date of the Escrow Letter of Credit Damages to be paid in accordance with Section 2.5 by $1,000 (the “Escrow L/C Expiration”), then Purchaser shall use reasonable best efforts to obtain and deliver to the Escrow Agent, at least three (3) business days prior to the Escrow L/C Expiration, a replacement clean, irrevocable and unconditional standby letter of credit in the aggregate face amount equal to the amount of funds remaining under the Escrow Letter of Credit (i) in substantially the same form as the Escrow Letter of Credit or such other form as is reasonably acceptable to the Partnership and the Escrow Agent and (ii) from the then-current lender under the Escrow Letter of Credit or such other lender as is reasonably acceptable to the Partnership (the “Replacement Letter of CreditStated Value”). The Escrow Agreement Each share of Parent Preferred Stock and each share of Parent Preferred Stock underlying the Parent Warrants shall provide that if the Escrow Agent has not received have a Replacement Letter value of Credit from Purchaser and written notice from the Partnership that the Replacement Letter of Credit satisfies the requirements of this Section 2.12(d) at least six (6) business days prior to the Escrow L/C Expiration, then prior to the close of business on the third (3rd) business day prior to the Escrow L/C Expiration (with time of the essence), the Escrow Agent shall draw all funds remaining under the Escrow Letter of Credit and hold such funds in the Indemnity Escrow Account for release pursuant to the applicable provisions of the Escrow Agreement (a “Full Draw Event”). Following the expiration of the Escrow Letter of Credit, all references in this Agreement and the Escrow Agreement to the Escrow Letter of Credit shall be deemed to refer to the Replacement Letter of Credit (and any subsequent replacement standby letter of credit that complies with this Section 2.12(d)), and this Section 2.12(d) shall apply to the Replacement Letter of Credit mutatis mutandis$1,000. (e) The Parties agree If the outstanding shares of Parent Preferred Stock shall be changed into or exchanged for a different number or kind of shares of stock or other securities of Parent or of another corporation, whether through reorganization, recapitalization, stock split-up, combination of shares, sale of assets, merger or consolidation, whether or not Parent is the surviving corporation, then Parent shall be obligated to substitute for the Parent Preferred Stock the number and kind of shares of stock or other securities into which each outstanding share of Parent Preferred Stock shall be so changed. In the event a contingency described in this subsection occurs, the Stated Value shall be appropriately adjusted in a manner as agreed by Parent and the Controlling Securityholders within 30 days of such event. (f) Promptly (i) after nine months following the Closing Date (the “First Release Date”), Parent shall distribute to the Securityholders as Merger Consideration an amount equal to 50% of the initial Indemnification Holdback less the amount of Merger Consideration previously deducted by parent as a Final Claim Amount, and (ii) after August 15, 2011 (the “Indemnification Expiration Date”), Parent shall distribute the remainder of the Indemnification Holdback (the “Indemnification Final Distribution Amount”) to the Securityholders as Merger Consideration; provided, however, that in the event that prior to the First Release Date or the Indemnification Expiration Date, Parent delivers a Payment Request to the Controlling Securityholders seeking indemnification for Damages (a “Pending Claim”) and such Pending Claim is unresolved as of the First Release Date or the Indemnification Expiration Date, Parent shall not distribute, and will continue to hold pursuant to this Agreement, that number of shares of Parent Preferred Stock pursuant to the Indemnification Holdback having a value equal to the Damages amount sought with respect to such Pending Claim that is unresolved, which Parent Preferred Stock shall be valued at the Stated Value (the “Reserved Stock”). Parent shall continue to holdback the Reserved Stock following the First Release Date or Indemnification Expiration Date, as applicable, pending resolution of the applicable Pending Claim and, upon resolution of the applicable Pending Claim, shall either (i) deduct such Reserved Stock in whole or in part from the Indemnification Holdback payable to the Securityholders as appropriate following resolution of the applicable Pending Claim in accordance with Section 2.5, or (ii) distribute as Merger Consideration to Securityholders pursuant to this Agreement. In the event that (i) the Controlling Securityholders or Parent delivers to the other a Final Order that determines or provides that the Escrow Agreement shall treat Parent Indemnitees are or are not, as the Escrow Letter case may be, entitled to payment or reimbursement of Credit some or all of the Damages requested in any Pending Claim, or (ii) Parent and the Controlling Securityholders jointly agree in writing that the Parent Indemnitees are or are not, as the case may be, entitled to some or all of the Damages requested in any funds Pending Claim, Parent will disburse the Reserved Stock or portion thereof held in respect of the Indemnity Escrow Account Damages subject to such Pending Claim to the Securityholders pursuant to the Merger Agreement or the Parent Indemnitees, in each case, as owned specified in such Final Order or written agreement. At such time after the Indemnification Expiration Period as all Pending Claims have been finally resolved in accordance with Section 2.5 and there remains any Reserved Stock, all remaining Reserved Stock shall be delivered by Parent to the Partnership Securityholders pursuant to this Agreement as Merger Consideration. A Pending Claim shall be considered to be resolved at such time as (1) either Parent or the Controlling Securityholders delivers to the other a Final Order determining the extent, if any, to which the Parent Indemnitee is entitled to indemnification under Article VIII below for U.S. federal income tax purposesthe Damages pursuant to such Pending Claim, or (2) Parent and the Controlling Securityholders agree in writing that such Pending Claim has otherwise been resolved, which such written agreement indicates the extent, if any, to which the Parent Indemnitee is entitled to indemnification under Article VIII below for the Damages pursuant to such Pending Claim.

Appears in 1 contract

Samples: Merger Agreement (Geos Communications, Inc.)

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Indemnification Escrow. (a) The Escrow Deposit Amount, or from and after On the Closing Date, each of Parent and the Remaining Sellers’ Representative shall execute and deliver an escrow agreement in substantially the form attached hereto as Exhibit B-2 (the “Indemnification Escrow Deposit AmountAgreement”). On the Closing Date, Parent shall (subject deposit with the Escrow Agent a portion of the Total Transaction Consideration otherwise payable to the terms and conditions of Article 6) serve as and be the sole and exclusive source for payment of claims for indemnification by any Purchaser Indemnitee pursuant to Article 6. The Escrow Letter of Credit, which shall be provided Sellers at the Closing by Purchaser equal to $91,500,000 (the “Indemnification Escrow”). The Indemnification Escrow Agent in respect of the Escrow Deposit Amount, shall be held by the Escrow Agent in an account pursuant to the terms of the Indemnification Escrow Agreement. Pursuant to the Indemnification Escrow Agreement, the Indemnification Escrow shall be released by the Escrow Agent as follows: (i) On the first anniversary of the Closing Date (the “Indemnity Escrow AccountFirst Release Date) ), in accordance with the terms and conditions of an escrow agreement in the form attached hereto as Exhibit G (the “Indemnification Escrow Agreement”). (b) On the date which is twelve (12) months following the Closing, the Escrow Agent shall release from the Indemnification Escrow and pay and disburse to the Partnership, via a draw on Sellers’ Representative an amount equal to seventy-five percent (75%) of the funds available under the Indemnification Escrow Letter minus any amounts of Credit, the Initial Indemnity Release Amount calculated in accordance with Section 2.13, and the amount available any indemnity claims made pursuant to Article IX (whether or not such indemnity claims have been determined to be drawn under valid) as of such First Release Date, which amount shall be distributed by the Escrow Letter of Credit and Sellers’ Representative to the aggregate principal amount Sellers on an equal per share basis; and (ii) On the second anniversary of the Escrow Letter of Credit shall be reduced to reflect Closing Date (the foregoing draw and payment. (c) Notwithstanding anything in this Agreement or in the Escrow Agreement to the contrary“Second Release Date”), in the event that the Partnership is entitled, pursuant to this Agreement and the Escrow Agreement, to funds to be drawn from the Escrow Letter of Credit and the Escrow Agent is not able to draw all or any part of such funds from the Escrow Letter of Credit after receiving a notice (formatted as a joint written instruction) directing it to draw and release such funds, whether due to the expiration of the Escrow Letter of Credit, technical draw issues or otherwise, then, and in any such event, Purchaser shall deliver to the Partnership, by wire transfer of immediately available funds, not later than three (3) business days (with time of the essence) after a written request therefor from the Partnership, the amount of funds to which the Partnership is entitled or, if less than such amount, the remaining amount available to be drawn under the Escrow Letter of Credit, and the amount available to be drawn thereafter under the Escrow Letter of Credit (if not already equal to Zero) shall be reduced by the amount of such wire transfer. Without limiting the forgoing, any inability of the Escrow Agent to draw upon the Escrow Letter of Credit for any amount that is properly payable to the Partnership from the Escrow Letter of Credit or the Indemnity Escrow Account pursuant to this Agreement and the Escrow Agreement shall not relieve the Purchaser from its obligation to have made or to make such payment to the Partnership, and the Purchaser shall effect such payment by wire transfer in accordance with the preceding sentence. (d) If either Purchaser or the Partnership anticipates that there will be any funds remaining under the Escrow Letter of Credit as terms of the expiration date of the Indemnification Escrow Letter of Credit (the “Escrow L/C Expiration”), then Purchaser shall use reasonable best efforts to obtain and deliver to the Escrow Agent, at least three (3) business days prior to the Escrow L/C Expiration, a replacement clean, irrevocable and unconditional standby letter of credit in the aggregate face amount equal to the amount of funds remaining under the Escrow Letter of Credit (i) in substantially the same form as the Escrow Letter of Credit or such other form as is reasonably acceptable to the Partnership and the Escrow Agent and (ii) from the then-current lender under the Escrow Letter of Credit or such other lender as is reasonably acceptable to the Partnership (the “Replacement Letter of Credit”). The Escrow Agreement shall provide that if the Escrow Agent has not received a Replacement Letter of Credit from Purchaser and written notice from the Partnership that the Replacement Letter of Credit satisfies the requirements of this Section 2.12(d) at least six (6) business days prior to the Escrow L/C Expiration, then prior to the close of business on the third (3rd) business day prior to the Escrow L/C Expiration (with time of the essence)Agreement, the Escrow Agent shall draw release and pay to the Sellers’ Representative all funds remaining under the Escrow Letter of Credit and hold such funds amounts then contained in the Indemnity Indemnification Escrow Account for release minus any amounts of any indemnity claims made pursuant to Article IX (whether or not such indemnity claims have been determined to be valid) as of such Second Release Date, which amount shall be distributed by the applicable provisions Sellers’ Representative to the Sellers on an equal per share basis. To the extent the Sellers’ Representative disagrees with the amounts determined under clauses (i) and (ii), the dispute shall be submitted to mediation pursuant to Section 9.5. A portion of the Escrow Agreement (a “Full Draw Event”). Following the expiration balance of the amounts remaining in the Indemnification Escrow Letter shall be paid to the Sellers’ Representative as each claim remaining after the Second Release Date is resolved, with the portion to be repaid being equal to the amount retained in the Indemnification Escrow in respect of Creditthe resolved claim. At such time as all remaining claims have been resolved, all references remaining amounts in this Agreement the Indemnification Escrow shall be released and the Escrow Agreement paid to the Escrow Letter of Credit shall be deemed to refer to the Replacement Letter of Credit (and any subsequent replacement standby letter of credit that complies with this Section 2.12(d)), and this Section 2.12(d) shall apply to the Replacement Letter of Credit mutatis mutandisSellers’ Representative. (e) The Parties agree that the Escrow Agreement shall treat the Escrow Letter of Credit and any funds held in the Indemnity Escrow Account as owned by the Partnership for U.S. federal income tax purposes.

Appears in 1 contract

Samples: Stock Purchase Agreement (Harrahs Entertainment Inc)

Indemnification Escrow. (a) The Escrow Deposit AmountAt the Closing, or from and after an amount equal to $250,000.00 of the Closing the Remaining Escrow Deposit Amount, shall (subject to the terms and conditions of Article 6) serve as and be the sole and exclusive source for payment of claims for indemnification by any Purchaser Indemnitee pursuant to Article 6. The Escrow Letter of Credit, which Purchase Price shall be provided at the Closing by Purchaser withheld and delivered to the Escrow Agent and deposited in respect escrow by the Purchaser (the “Indemnification Escrow Amount”), to be held for a period of 18 months following the Closing Date (the “Indemnification Escrow Period”) to secure the Seller’s indemnification obligations under this Section 6.2. The Escrow Agent shall deposit the Indemnification Escrow Amount in a non-interest-bearing account to be held in accordance with the form of escrow agreement (“Indemnification Escrow Agreement”) attached hereto as Exhibit E. (i) Fifty percent (50%) of the Indemnification Escrow Deposit Amount, Amount shall be held released and paid by the Escrow Agent in an account to the Seller on the 1st anniversary of the Closing Date (the “Indemnity Escrow Account”) in accordance with the terms and conditions of an escrow agreement in the form attached hereto as Exhibit G (the “Escrow AgreementFirst Release”). (b) On the date which is twelve (12) months following the Closing; provided, however, the Escrow Agent shall pay and disburse to the Partnership, via a draw on the funds available under the Escrow Letter of Credit, the Initial Indemnity First Release Amount calculated in accordance with Section 2.13, and the amount available to be drawn under the Escrow Letter of Credit and the aggregate principal amount of the Escrow Letter of Credit shall be reduced to reflect the foregoing draw and payment. (c) Notwithstanding anything in this Agreement or in the Escrow Agreement to the contrary, in the event that the Partnership is entitled, pursuant to this Agreement and the Escrow Agreement, to funds to be drawn from the Escrow Letter of Credit and the Escrow Agent is not able to draw all or any part of such funds from the Escrow Letter of Credit after receiving a notice (formatted as a joint written instruction) directing it to draw and release such funds, whether due to the expiration of the Escrow Letter of Credit, technical draw issues or otherwise, then, and in any such event, Purchaser shall deliver to the Partnership, by wire transfer of immediately available funds, not later than three (3) business days (with time of the essence) after a written request therefor from the Partnership, the amount of funds to which the Partnership is entitled or, if less than such amount, the remaining amount available to be drawn under the Escrow Letter of Credit, and the amount available to be drawn thereafter under the Escrow Letter of Credit (if not already equal to Zero) shall be reduced by any amounts either (A) paid to a Purchaser Indemnified Party from the amount Indemnification Escrow Amount, or (B) subject to a disputed claim as of such wire transfer. Without limiting the forgoing, any inability date of the First Release. (ii) The remaining portion of the Indemnification Escrow Amount shall be released and paid by the Escrow Agent to draw upon the Seller at the end of the Indemnification Escrow Letter Period (the “Second Release”); provided, however, the Second Release shall be reduced by any amounts either (A) paid to a Purchaser Indemnified Party from the Indemnification Escrow Amount, or (B) subject to a disputed claim as of Credit the date of the Second Release. (iii) If the Seller receives notice from the Purchaser of a request for indemnification during the Indemnification Escrow Period and the Seller does not dispute its indemnification obligation in connection therewith, the Purchaser may, only after complying with the procedures described in the Indemnification Escrow Agreement, set off the amount owed to it in respect of such indemnification obligation against the Indemnification Escrow Amount. Such amount will reduce the Indemnification Escrow Amount and any amount that is properly payable corresponding release owed to the Partnership from Seller during the applicable period set forth in this Section 6.2(d), or upon termination of the Indemnification Escrow Letter Period, as the case may be. Prior to exercising its right of Credit or the Indemnity Escrow Account pursuant to this Agreement and the Escrow Agreement shall not relieve the Purchaser from its obligation to have made or to make such payment to the Partnershipset-off hereunder, and the Purchaser shall effect such payment by wire transfer notify the Seller in accordance with the preceding sentence. (d) If either Purchaser or the Partnership anticipates that there will be any funds remaining under the Escrow Letter of Credit as writing of the expiration date of matter in dispute together with all material facts and circumstances reasonably necessary for the Escrow Letter of Credit (Seller to determine the “Escrow L/C Expiration”), then Purchaser shall use reasonable best efforts to obtain and deliver to the Escrow Agent, at least three (3) business days prior to the Escrow L/C Expiration, a replacement clean, irrevocable and unconditional standby letter of credit in the aggregate face amount equal to the amount of funds remaining under the Escrow Letter of Credit (i) in substantially the same form as the Escrow Letter of Credit Basis for such claim or such other form as is reasonably acceptable to the Partnership and the Escrow Agent and (ii) from the then-current lender under the Escrow Letter of Credit or such other lender as is reasonably acceptable to the Partnership (the “Replacement Letter of Credit”). The Escrow Agreement shall provide that if the Escrow Agent has not received a Replacement Letter of Credit from Purchaser and written notice from the Partnership that the Replacement Letter of Credit satisfies the requirements of this Section 2.12(d) at least six (6) business days prior to the Escrow L/C Expiration, then prior to the close of business on the third (3rd) business day prior to the Escrow L/C Expiration (with time of the essence), the Escrow Agent shall draw all funds remaining under the Escrow Letter of Credit and hold such funds in the Indemnity Escrow Account for release pursuant to the applicable provisions of the Escrow Agreement (a “Full Draw Event”). Following the expiration of the Escrow Letter of Credit, all references in this Agreement and the Escrow Agreement to the Escrow Letter of Credit shall be deemed to refer to the Replacement Letter of Credit (and any subsequent replacement standby letter of credit that complies with this Section 2.12(d)), and this Section 2.12(d) shall apply to the Replacement Letter of Credit mutatis mutandisasserted obligation. (e) The Parties agree that the Escrow Agreement shall treat the Escrow Letter of Credit and any funds held in the Indemnity Escrow Account as owned by the Partnership for U.S. federal income tax purposes.

Appears in 1 contract

Samples: Asset Purchase Agreement (LMP Automotive Holdings, Inc.)

Indemnification Escrow. (ai) The All Indemnification Escrow Deposit Amount, or from and after the Closing the Remaining Escrow Deposit Amount, shall (subject to the terms and conditions of Article 6) serve as and be the sole and exclusive source for payment of claims for indemnification by any Purchaser Indemnitee pursuant to Article 6. The Escrow Letter of Credit, which shall be provided at the Closing by Purchaser to the Escrow Agent in respect of the Escrow Deposit Amount, shall Funds will be held by the Escrow Agent in an account (order to provide a fund for the “Indemnity Escrow Account”) payment of any claims for which Buyer is entitled to indemnification under Article 10, or any claims by Buyer against Seller for payments required to be made pursuant to Section 5.5(e), and will be disbursed in accordance with the terms Escrow Agreement and conditions of an escrow agreement in the form attached hereto as Exhibit G (the “Escrow this Agreement”). (bii) On the date which is twelve (12) months following the ClosingAt any time Buyer makes any indemnification claim against Seller under Article 10 or any claim against Seller for payments required to be made pursuant to Section 5.5(e), Buyer shall give a copy of such notice to the Escrow Agent concurrently with Buyer’s delivery of notice of such claim to Seller. Buyer’s notice shall pay specify the dollar amount to be reserved against the claim. If Buyer and disburse Seller agree as to the Partnership, via a draw on the funds available under the Escrow Letter of Credit, the Initial Indemnity Release Amount calculated in accordance with Section 2.13, validity and the amount available to be drawn under the Escrow Letter of Credit and the aggregate principal amount of the Escrow Letter of Credit such claim, Buyer and Seller shall be reduced to reflect the foregoing draw and payment. (c) Notwithstanding anything in this Agreement or in the Escrow Agreement to the contrary, in the event that the Partnership is entitled, pursuant to this Agreement and the Escrow Agreement, to funds to be drawn from the Escrow Letter of Credit and promptly give the Escrow Agent is not able to draw all or any part of such funds from the Escrow Letter of Credit after receiving a notice (formatted as a joint written instruction) directing it instructions to draw and release such funds, whether due disburse to the expiration Buyer a portion of the Indemnification Escrow Letter of Credit, technical draw issues or otherwise, then, and in any such event, Purchaser shall deliver to the Partnership, by wire transfer of immediately available funds, not later than three (3) business days (with time of the essence) after a written request therefor from the Partnership, the amount of funds to which the Partnership is entitled or, if less than such amount, the remaining amount available to be drawn under the Escrow Letter of Credit, and the amount available to be drawn thereafter under the Escrow Letter of Credit (if not already equal to Zero) shall be reduced by the amount of such wire transfer. Without limiting the forgoing, any inability of the Escrow Agent to draw upon the Escrow Letter of Credit for any amount that is properly payable to the Partnership from the Escrow Letter of Credit or the Indemnity Escrow Account pursuant to this Agreement and the Escrow Agreement shall not relieve the Purchaser from its obligation to have made or to make such payment to the Partnership, and the Purchaser shall effect such payment by wire transfer in accordance with the preceding sentence. (d) If either Purchaser or the Partnership anticipates that there will be any funds remaining under the Escrow Letter of Credit as of the expiration date of the Escrow Letter of Credit (the “Escrow L/C Expiration”), then Purchaser shall use reasonable best efforts to obtain and deliver to the Escrow Agent, at least three (3) business days prior to the Escrow L/C Expiration, a replacement clean, irrevocable and unconditional standby letter of credit in the aggregate face amount Funds equal to the amount of funds remaining under such claim, together with any interest or other earnings in respect of such amount from the Escrow Letter of Credit (i) in substantially the same form Closing Date. If Buyer and Seller do not agree as the Escrow Letter of Credit or such other form as is reasonably acceptable to the Partnership validity and amount of such claim, the matter shall be resolved in accordance with this Agreement and applicable law. If any disputed claim is subsequently resolved in favor of Buyer, Buyer and Seller shall promptly give the Escrow Agent and (ii) joint written instructions to disburse to Buyer a portion of the Indemnification Escrow Funds equal to the amount required to satisfy Buyer’s claim, as so resolved, together with any interest or other earnings in respect of such amount from the then-current lender under Closing Date. (iii) On the Escrow Letter first business day that is more than eighteen months after the date of Credit or such other lender as is reasonably acceptable to the Partnership (the “Replacement Letter of Credit”). The Escrow Agreement shall provide that if this Agreement, Buyer and Seller will jointly instruct the Escrow Agent has not received a Replacement Letter to disburse to Seller the amount, if any, by which the Indemnification Escrow Funds exceed the amount of Credit from Purchaser and written notice all claims made by Buyer against the Indemnification Escrow Funds, together with any interest or other earnings in respect of such amount from the Partnership that Closing Date. (iv) From time to time after the Replacement Letter of Credit satisfies the requirements of disbursement to Seller pursuant to Section 2.7(c)(iii) has been made, when any claim made by Buyer against Seller under this Section 2.12(d) at least six (6) business days prior to the Escrow L/C ExpirationAgreement is resolved, then prior to the close of business on the third (3rd) business day prior to the Escrow L/C Expiration (with time of the essence), Buyer and Seller shall jointly instruct the Escrow Agent to disburse to Buyer the amount specified in Section 2.7(c)(ii) relating to the resolved claim, together with any interest or other earnings in respect of such amount from the Closing Date, and to disburse to Seller a specified amount which shall draw equal the amount, if any, by which the Indemnification Escrow Funds exceed the amount required to satisfy any indemnification claims by Buyer that remain pending, together with any interest or other earnings in respect of the amount of such pending claims from the Closing Date. When all funds remaining under claims against the Indemnification Escrow Funds have been resolved, after all required disbursements to Buyer pursuant to Section 2.7(c)(ii) have been made, Buyer and Seller shall jointly instruct the Escrow Letter of Credit and hold such funds in the Indemnity Agent to disburse to Seller any remaining Indemnification Escrow Account for release pursuant to the applicable provisions of the Escrow Agreement (a “Full Draw Event”). Following the expiration of the Escrow Letter of Credit, all references in this Agreement and the Escrow Agreement to the Escrow Letter of Credit shall be deemed to refer to the Replacement Letter of Credit (and any subsequent replacement standby letter of credit that complies with this Section 2.12(d)), and this Section 2.12(d) shall apply to the Replacement Letter of Credit mutatis mutandisFunds. (e) The Parties agree that the Escrow Agreement shall treat the Escrow Letter of Credit and any funds held in the Indemnity Escrow Account as owned by the Partnership for U.S. federal income tax purposes.

Appears in 1 contract

Samples: Asset Purchase Agreement (West Marine Inc)

Indemnification Escrow. (a) The Escrow Deposit AmountEach of Parent, or from the Company and after the Securityholders hereby acknowledge and agree that, in accordance with Section 2.10 of the Agreement and in order to secure the indemnity obligations of the Securityholders to the Buyer Indemnified Parties under the Agreement, at the Closing a portion of the Remaining Escrow Deposit Amount, shall (subject Merger Consideration that would otherwise have been required to be delivered to the Securityholders equal to $15,000,000 was deposited and has been held in escrow pursuant to the terms of the Indemnification Escrow Agreement, and conditions that the portion of Article 6) serve such amount that was withheld from the portion of the Merger Consideration that would otherwise have been delivered to such Securityholder is set forth opposite such Securityholder's name in column C of Schedule I to the Agreement. Each of Parent, the Company and the Securityholders hereby acknowledge and agree that, as promptly as practicable following the execution and be delivery of this Amendment by all parties hereto, the sole Representative, Parent and exclusive source for payment of claims for indemnification by any Purchaser Indemnitee pursuant to Article 6. The Escrow Letter of Credit, which shall be provided at the Closing by Purchaser to the Escrow Agent will enter into an amendment to the Indemnification Escrow Agreement in respect the form of ANNEX II hereto, subject only to the comments, if any, of the Escrow Deposit AmountAgent as to its rights and obligations under the Indemnification Escrow Agreement (the "Escrow Agreement Amendment"). Simultaneously with the execution and delivery of the Escrow Agreement Amendment, and in order to secure Xxxxxxxx'x indemnity obligations to the Buyer Indemnified Parties, Xxxxxxxx shall be held by deposit the Letter of Credit with the Escrow Agent in an account (the “Indemnity Escrow Account”) to be held in accordance with the terms hereof and conditions of an escrow agreement in the form attached hereto as Exhibit G (the “Indemnification Escrow Agreement”). (b) On the date which is twelve (12) months following the Closing. Each of Parent, the Escrow Agent shall pay Company and disburse the Securityholders hereby covenant and agree that the Agreement is hereby amended to the Partnership, via a draw on extent required to allow the funds available under the Escrow Letter of Credit, the Initial Indemnity Release Amount calculated in accordance with Section 2.13, and the amount available to be drawn under the Escrow Letter of Credit and the aggregate principal amount substitution of the Escrow Letter of Credit shall be reduced to reflect the foregoing draw and payment. (c) Notwithstanding anything in this Agreement or in the Escrow Agreement to the contrary, in the event that the Partnership is entitled, pursuant to this Agreement and the Escrow Agreement, to funds to be drawn from the Escrow Letter of Credit and the Escrow Agent is not able to draw all or any part of such funds from the Escrow Letter of Credit after receiving a notice (formatted as a joint written instruction) directing it to draw and release such funds, whether due to the expiration of the Escrow Letter of Credit, technical draw issues or otherwise, then, and in any such event, Purchaser shall deliver to the Partnership, by wire transfer of immediately available funds, not later than three (3) business days (with time of the essence) after a written request therefor from the Partnership, the amount of funds to which the Partnership is entitled or, if less than such amount, the remaining amount available to be drawn under the Escrow Letter of Credit, and the amount available to be drawn thereafter under the Escrow Letter of Credit (if not already equal to Zero) shall be reduced by the amount of such wire transfer. Without limiting the forgoing, any inability of the Escrow Agent to draw upon the Escrow Letter of Credit for any amount that is properly payable to the Partnership from the Escrow Letter of Credit or the Indemnity Escrow Account pursuant to this Agreement and the Escrow Agreement shall not relieve the Purchaser from its obligation to have made or to make such payment to the Partnership, and the Purchaser shall effect such payment by wire transfer in accordance with the preceding sentence. (d) If either Purchaser or the Partnership anticipates that there will be any funds remaining under the Escrow Letter of Credit as of the expiration date portion of the Escrow Letter Amount which was previously deposited on behalf of Credit (the “Escrow L/C Expiration”), then Purchaser shall use reasonable best efforts to obtain and deliver to the Escrow Agent, at least three (3) business days prior to the Escrow L/C Expiration, a replacement clean, irrevocable and unconditional standby letter of credit in the aggregate face amount equal to the amount of funds remaining under the Escrow Letter of Credit (i) in substantially the same form as the Escrow Letter of Credit or such other form as is reasonably acceptable to the Partnership and the Escrow Agent and (ii) from the then-current lender under the Escrow Letter of Credit or such other lender as is reasonably acceptable to the Partnership (the “Replacement Letter of Credit”). The Escrow Agreement shall provide that if the Escrow Agent has not received a Replacement Letter of Credit from Purchaser and written notice from the Partnership that the Replacement Letter of Credit satisfies the requirements of this Section 2.12(d) at least six (6) business days prior to the Escrow L/C Expiration, then prior to the close of business on the third (3rd) business day prior to the Escrow L/C Expiration (with time of the essence), the Escrow Agent shall draw all funds remaining under the Escrow Letter of Credit and hold such funds in the Indemnity Escrow Account for release pursuant to the applicable provisions of the Escrow Agreement (a “Full Draw Event”). Following the expiration of the Escrow Letter of Credit, all references in this Agreement and the Escrow Agreement to the Escrow Letter of Credit shall be deemed to refer to the Replacement Letter of Credit (and any subsequent replacement standby letter of credit that complies with this Section 2.12(d))Xxxxxxxx, and this Section 2.12(d) shall apply to the Replacement Letter of Credit mutatis mutandishereby irrevocably waive any breach or default that would otherwise result from such substitution. (e) The Parties agree that the Escrow Agreement shall treat the Escrow Letter of Credit and any funds held in the Indemnity Escrow Account as owned by the Partnership for U.S. federal income tax purposes.

Appears in 1 contract

Samples: Agreement and Plan of Merger (Atrium Companies Inc)

Indemnification Escrow. (a) The Escrow Deposit Amount, or from and after On the Closing Date, Buyer, Seller and Wachovia Bank, N.A. the Remaining ("Escrow Deposit AmountAgent") shall execute a Post-Closing Escrow Agreement substantially in the form attached as Exhibit C (the "Post-Closing Escrow Agreement") in accordance with which, shall (subject to the terms and conditions of Article 6) serve as and be the sole and exclusive source for payment of claims for indemnification by any Purchaser Indemnitee pursuant to Article 6. The Escrow Letter of Credit, which shall be provided at on the Closing Date, Buyer shall deposit Two Million Dollars ($2,000,000) of the Purchase Price with the Escrow Agent (such deposit and all amounts held from time to time by Purchaser to the Escrow Agent in respect of such deposit, including any interest or other earnings in respect of such deposit, the Escrow Deposit Amount, "Indemnification Funds") in order to provide a fund for the payment of any claims for which Buyer is entitled to indemnification as provided in this Article 11. The Indemnification Funds shall be held by the Escrow Agent in an account (the “Indemnity Escrow Account”) and disbursed in accordance with the terms and conditions -40- 47 of an escrow agreement in the form attached hereto as Exhibit G (the “Escrow Agreement”). (b) On the date which is twelve (12) months following the Closing, the Escrow Agent shall pay and disburse to the Partnership, via a draw on the funds available under the Escrow Letter of Credit, the Initial Indemnity Release Amount calculated in accordance with Section 2.13, and the amount available to be drawn under the Escrow Letter of Credit and the aggregate principal amount of the Escrow Letter of Credit shall be reduced to reflect the foregoing draw and payment. (c) Notwithstanding anything in this Agreement or in the Escrow Agreement to the contrary, in the event that the Partnership is entitled, pursuant to this Agreement and the Post-Closing Escrow Agreement. On the first business day following the one year anniversary of the Closing Date, any Indemnification Funds not then subject to funds to indemnification claims of Buyer under this Agreement shall be drawn from the Escrow Letter of Credit and released by the Escrow Agent is not able to draw Seller. If at any time before the one year anniversary of the Closing Date, Seller sells, transfers or otherwise transfers all or substantially all of its assets, Seller shall cause Six Million Dollars ($6,000,000) to be deposited with and held by Union Bank of California in a segregated account that will not be available to satisfy any part obligations or liabilities of the Seller other than obligations to Buyer pursuant to this Article 11, and Seller shall provide Buyer with prompt reasonable evidence that such deposit has been made in accordance with the foregoing. Seller shall cause the entire $6,000,000 to be so held in such account until the one year anniversary of the Closing Date. If on the one year anniversary of the Closing Date there are any outstanding claims for indemnification by Buyer against Seller under this Article 11 and the stated amount of such funds from the Escrow Letter of Credit after receiving a notice (formatted as a joint written instruction) directing it to draw and release such funds, whether due to the expiration of the Escrow Letter of Credit, technical draw issues or otherwise, then, and in any such event, Purchaser shall deliver to the Partnership, by wire transfer of immediately available funds, not later than three (3) business days (with time of the essence) after a written request therefor from the Partnership, claims exceeds the amount of funds to which the Partnership is entitled or, if less than such amount, the Indemnification Funds then remaining amount available to be drawn under and being held by the Escrow Letter of CreditAgent, and the amount available to be drawn thereafter under the Escrow Letter of Credit (if not already equal to Zero) Seller shall be reduced by cause the amount of such wire transferdeficiency to continue to be so held in such account by Union Bank of California until such time as the one or more claims giving rise to such deficiency are resolved and Buyer has been paid any amounts to which it may be entitled in connection therewith, and Seller may cause any amounts so held by Union Bank of California in excess of such deficiency to be released to Seller. Without limiting the forgoing, So long as Seller is required to hold any inability of the Escrow Agent to draw upon the Escrow Letter of Credit for any amount that is properly payable to the Partnership from the Escrow Letter of Credit or the Indemnity Escrow Account monies in such account pursuant to this Agreement and the Escrow Agreement Section 11.5, Seller shall not relieve the Purchaser from its obligation to have made or to make such payment to the Partnership, and the Purchaser shall effect such payment by wire transfer in accordance provide Buyer with the preceding sentence. (d) If either Purchaser or the Partnership anticipates that there will be any funds remaining under the Escrow Letter of Credit as prompt reasonable evidence of the expiration date of the Escrow Letter of Credit (the “Escrow L/C Expiration”), then Purchaser shall use reasonable best efforts to obtain and deliver to the Escrow Agent, at least three (3) business days prior to the Escrow L/C Expiration, a replacement clean, irrevocable and unconditional standby letter of credit in the aggregate face amount equal to the amount of funds remaining under the Escrow Letter of Credit (i) in substantially the same form as the Escrow Letter of Credit or such other form as is reasonably acceptable to the Partnership and the Escrow Agent and (ii) from the then-current lender under the Escrow Letter of Credit or such other lender as is reasonably acceptable to the Partnership (the “Replacement Letter of Credit”). The Escrow Agreement shall provide that if the Escrow Agent has not received a Replacement Letter of Credit from Purchaser and written notice from the Partnership that the Replacement Letter of Credit satisfies the requirements of this Section 2.12(d) at least six (6) business days prior to the Escrow L/C Expiration, then prior to the close of business on the third (3rd) business day prior to the Escrow L/C Expiration (with time of the essence), the Escrow Agent shall draw all funds remaining under the Escrow Letter of Credit and hold such funds in the Indemnity Escrow Account for release pursuant to the applicable provisions of the Escrow Agreement (a “Full Draw Event”). Following the expiration of the Escrow Letter of Credit, all references in this Agreement and the Escrow Agreement to the Escrow Letter of Credit shall be deemed to refer to the Replacement Letter of Credit (and any subsequent replacement standby letter of credit that complies with this Section 2.12(d)), and this Section 2.12(d) shall apply to the Replacement Letter of Credit mutatis mutandis. (e) The Parties agree that the Escrow Agreement shall treat the Escrow Letter of Credit and any funds amounts held in the Indemnity Escrow Account as owned by the Partnership for U.S. federal income tax purposessuch account upon Buyer's request.

Appears in 1 contract

Samples: Stock Purchase Agreement (Spectrasite Holdings Inc)

Indemnification Escrow. (a) The Escrow Deposit AmountAt the Closing, or from and after an amount equal to $950,000 of the Closing the Remaining Escrow Deposit Amount, shall (subject to the terms and conditions of Article 6) serve as and be the sole and exclusive source for payment of claims for indemnification by any Purchaser Indemnitee pursuant to Article 6. The Escrow Letter of Credit, which Asset Interest Price shall be provided at the Closing by Purchaser withheld and delivered to the Escrow Agent and deposited in respect escrow by the Purchaser (the “Indemnification Escrow Amount”), to be held for a period of 24 months following the Closing Date (the “Indemnification Escrow Period”) to secure the Seller’s indemnification obligations under this Section 6.2. The Escrow Agent shall deposit the Indemnification Escrow Amount in a non-interest-bearing account to be held in accordance with the form of escrow agreement (“Indemnification Escrow Agreement”) attached hereto as Exhibit G. (i) Fifty percent (50%) of the Indemnification Escrow Deposit Amount, Amount shall be held released and paid by the Escrow Agent in an account to the Seller on the 1st anniversary of the Closing Date (the “Indemnity Escrow Account”) in accordance with the terms and conditions of an escrow agreement in the form attached hereto as Exhibit G (the “Escrow AgreementFirst Release”). (b) On the date which is twelve (12) months following the Closing; provided, however, the Escrow Agent shall pay and disburse to the Partnership, via a draw on the funds available under the Escrow Letter of Credit, the Initial Indemnity First Release Amount calculated in accordance with Section 2.13, and the amount available to be drawn under the Escrow Letter of Credit and the aggregate principal amount of the Escrow Letter of Credit shall be reduced to reflect the foregoing draw and payment. (c) Notwithstanding anything in this Agreement or in the Escrow Agreement to the contrary, in the event that the Partnership is entitled, pursuant to this Agreement and the Escrow Agreement, to funds to be drawn from the Escrow Letter of Credit and the Escrow Agent is not able to draw all or any part of such funds from the Escrow Letter of Credit after receiving a notice (formatted as a joint written instruction) directing it to draw and release such funds, whether due to the expiration of the Escrow Letter of Credit, technical draw issues or otherwise, then, and in any such event, Purchaser shall deliver to the Partnership, by wire transfer of immediately available funds, not later than three (3) business days (with time of the essence) after a written request therefor from the Partnership, the amount of funds to which the Partnership is entitled or, if less than such amount, the remaining amount available to be drawn under the Escrow Letter of Credit, and the amount available to be drawn thereafter under the Escrow Letter of Credit (if not already equal to Zero) shall be reduced by any amounts either (A) paid to a Purchaser Indemnified Party from the amount Indemnification Escrow Amount, or (B) subject to a disputed claim as of such wire transfer. Without limiting the forgoing, any inability date of the First Release. (ii) The remaining portion of the Indemnification Escrow Amount shall be released and paid by the Escrow Agent to draw upon the Seller on the 2nd anniversary of the Closing Date (the “Second Release”); provided, however, the Second Release shall be reduced by any amounts either (A) paid to a Purchaser Indemnified Party from the Indemnification Escrow Letter Amount, or (B) subject to a disputed claim as of Credit the date of the Second Release. (iii) If the Seller receives notice from the Purchaser of a request for indemnification during the Indemnification Escrow Period and the Seller does not dispute its indemnification obligation in connection therewith, the Purchaser may, only after complying with the procedures described in the Indemnification Escrow Agreement, set off the amount owed to it in respect of such indemnification obligation against the Indemnification Escrow Amount. Such amount will reduce the Indemnification Escrow Amount and any amount that is properly payable corresponding release owed to the Partnership from Seller during the applicable period set forth in this Section 6.2(d), or upon termination of the Indemnification Escrow Letter Period, as the case may be. Prior to exercising its right of Credit or the Indemnity Escrow Account pursuant to this Agreement and the Escrow Agreement shall not relieve the Purchaser from its obligation to have made or to make such payment to the Partnershipset-off hereunder, and the Purchaser shall effect such payment by wire transfer notify the Seller in accordance with the preceding sentence. (d) If either Purchaser or the Partnership anticipates that there will be any funds remaining under the Escrow Letter of Credit as writing of the expiration date of matter in dispute together with all material facts and circumstances reasonably necessary for the Escrow Letter of Credit (Seller to determine the “Escrow L/C Expiration”), then Purchaser shall use reasonable best efforts to obtain and deliver to the Escrow Agent, at least three (3) business days prior to the Escrow L/C Expiration, a replacement clean, irrevocable and unconditional standby letter of credit in the aggregate face amount equal to the amount of funds remaining under the Escrow Letter of Credit (i) in substantially the same form as the Escrow Letter of Credit Basis for such claim or such other form as is reasonably acceptable to the Partnership and the Escrow Agent and (ii) from the then-current lender under the Escrow Letter of Credit or such other lender as is reasonably acceptable to the Partnership (the “Replacement Letter of Credit”). The Escrow Agreement shall provide that if the Escrow Agent has not received a Replacement Letter of Credit from Purchaser and written notice from the Partnership that the Replacement Letter of Credit satisfies the requirements of this Section 2.12(d) at least six (6) business days prior to the Escrow L/C Expiration, then prior to the close of business on the third (3rd) business day prior to the Escrow L/C Expiration (with time of the essence), the Escrow Agent shall draw all funds remaining under the Escrow Letter of Credit and hold such funds in the Indemnity Escrow Account for release pursuant to the applicable provisions of the Escrow Agreement (a “Full Draw Event”). Following the expiration of the Escrow Letter of Credit, all references in this Agreement and the Escrow Agreement to the Escrow Letter of Credit shall be deemed to refer to the Replacement Letter of Credit (and any subsequent replacement standby letter of credit that complies with this Section 2.12(d)), and this Section 2.12(d) shall apply to the Replacement Letter of Credit mutatis mutandisasserted obligation. (e) The Parties agree that the Escrow Agreement shall treat the Escrow Letter of Credit and any funds held in the Indemnity Escrow Account as owned by the Partnership for U.S. federal income tax purposes.

Appears in 1 contract

Samples: Asset Purchase and Contribution Agreement (LMP Automotive Holdings, Inc.)

Indemnification Escrow. (a) The At Closing, the Indemnification Escrow Deposit Amountwill be transferred by Acquiror to, or from and after the Closing the Remaining Escrow Deposit Amount, shall thereafter held by (subject to the terms of this Agreement and conditions the Escrow Agreement), Escrow Agent as security of Article 6) serve the indemnification obligations of the Security Holders under Section 9.2 hereof. Stockholders’ Agent and Acquiror shall cause any portion of the Indemnification Escrow not previously released to Acquiror as and a result of an indemnification claim by Acquiror, including as a result of Section 9.3, to be the sole and exclusive source for payment of claims for indemnification by any Purchaser Indemnitee pursuant to Article 6. The Escrow Letter of Credit, which shall be provided at the Closing by Purchaser released to the Escrow Agent Security Holders as set forth in respect of the Escrow Deposit Amount, shall be held by the Escrow Agent in an account Sections 9.1(b) and (the “Indemnity Escrow Account”) in accordance with the terms and conditions of an escrow agreement in the form attached hereto as Exhibit G (the “Escrow Agreement”c). (b) On No later than the date which is twelve (12) months following the Closing***, Stockholders’ Agent and Acquiror shall cause the Escrow Agent shall pay and disburse to the Partnership, via a draw on the funds available under the Escrow Letter *** of Credit, the Initial Indemnity Release Amount calculated in accordance with Section 2.13, and the amount available to be drawn under the Escrow Letter of Credit and the aggregate principal amount an *** equal *** portion of the Indemnification Escrow Letter *** and is not subject to *** reflected in one or more ***. *** Portions of Credit shall be reduced this page have been omitted pursuant to reflect a request for Confidential Treatment filed separately with the foregoing draw and paymentCommission. (c) Notwithstanding anything in this Agreement or in the Escrow Agreement to the contrary, in the event that the Partnership is entitled, pursuant to this Agreement and the Escrow Agreement, to funds to be drawn from the Escrow Letter of Credit and the Escrow Agent is not able to draw all or any part of such funds from the Escrow Letter of Credit after receiving a notice (formatted as a joint written instruction) directing it to draw and release such funds, whether due to the expiration of the Escrow Letter of Credit, technical draw issues or otherwise, then, and in any such event, Purchaser shall deliver to the Partnership, by wire transfer of immediately available funds, not No later than three (3) business days (with time of the essence) after a written request therefor from the PartnershipFinal Escrow Release Date, the amount of funds to which the Partnership is entitled or, if less than such amount, the remaining amount available to be drawn under the Escrow Letter of Credit, Stockholders’ Agent and the amount available to be drawn thereafter under the Escrow Letter of Credit (if not already equal to Zero) Acquiror shall be reduced by the amount of such wire transfer. Without limiting the forgoing, any inability of cause the Escrow Agent to draw upon release to the Security Holders their applicable Escrow Letter Pro Rata Share of Credit for any amount amounts of the Indemnification Escrow that remain in escrow as of the Final Escrow Termination Date, less with respect to each such Security Holder, such Security Holder’s Escrow Pro Rata Share of the Indemnification Escrow that is properly payable not permitted to be released from escrow as of such date as a result of one or more Officer’s Certificates delivered by Acquiror pursuant to Section 9.3 with respect to any pending but unresolved indemnification claims of Acquiror. Any portion of the Indemnification Escrow that is not released to the Partnership from the Escrow Letter Security Holders as a result of Credit or the Indemnity Escrow Account pursuant to this Agreement and the Escrow Agreement Section 9.3 shall not relieve the Purchaser from its obligation to have made or to make such payment be released to the Partnership, and the Purchaser shall effect such payment by wire transfer in accordance with the preceding sentenceSecurity Holders or Acquiror (as appropriate) promptly upon resolution of each specific indemnification claim involved. (d) If either Purchaser or the Partnership anticipates that there will be any funds remaining under the Escrow Letter of Credit The cash held as part of the expiration date of the Indemnification Escrow Letter of Credit (the “Escrow L/C Expiration”), then Purchaser shall use reasonable best efforts to obtain and deliver be released to the respective Security Holders in accordance with such Security Holders’ Escrow Agent, at least three (3) business days prior to the Escrow L/C Expiration, a replacement clean, irrevocable and unconditional standby letter of credit in the aggregate face amount equal to the amount of funds remaining under the Escrow Letter of Credit (i) in substantially the same form as the Escrow Letter of Credit or such other form as is reasonably acceptable to the Partnership and the Escrow Agent and (ii) from the then-current lender under the Escrow Letter of Credit or such other lender as is reasonably acceptable to the Partnership (the “Replacement Letter of Credit”). The Escrow Agreement shall provide that if the Escrow Agent has not received a Replacement Letter of Credit from Purchaser and written notice from the Partnership that the Replacement Letter of Credit satisfies the requirements of this Section 2.12(d) at least six (6) business days prior to the Escrow L/C Expiration, then prior to the close of business on the third (3rd) business day prior to the Escrow L/C Expiration (with time of the essence), the Escrow Agent shall draw all funds remaining under the Escrow Letter of Credit and hold such funds in the Indemnity Escrow Account for release pursuant to the applicable provisions of the Escrow Agreement (a “Full Draw Event”). Following the expiration of the Escrow Letter of Credit, all references in this Agreement and the Escrow Agreement to the Escrow Letter of Credit shall be deemed to refer to the Replacement Letter of Credit (and any subsequent replacement standby letter of credit that complies with this Section 2.12(d)), and this Section 2.12(d) shall apply to the Replacement Letter of Credit mutatis mutandisPro Rata Share. (e) The Parties agree that the Escrow Agreement shall treat the Escrow Letter of Credit and any funds held in the Indemnity Escrow Account as owned by the Partnership for U.S. federal income tax purposes.

Appears in 1 contract

Samples: Merger Agreement (Nuvasive Inc)

Indemnification Escrow. (a) The Escrow Deposit Amount, or from and after the Closing the Remaining Escrow Deposit Amount, shall (subject Prior to the terms Effective Time, PUB and conditions the Shareholders’ Representative shall enter into the Indemnification Escrow Agreement with the Escrow Agent. Exhibit C contains the summary of Article 6) serve as and be the sole and exclusive source for Indemnification Escrow Agreement. At the Effective Time, PUB shall defer payment of claims for indemnification by any Purchaser Indemnitee pursuant to Article 6. The $500,000 of the Total Purchase Price (the “Indemnification Escrow Letter of Credit, which shall be provided at the Closing by Purchaser Amount”) and deliver such Indemnification Escrow Amount to the Escrow Agent to be released as described in respect of the Escrow Deposit Amount, shall be held by the Escrow Agent in an account (the “Indemnity Escrow Account”) in accordance with the terms Article 9 and conditions of an escrow agreement in the form attached hereto as Exhibit G (the “Indemnification Escrow Agreement”). (b) On At the date which end of the period that is twelve eighteen months from the Closing Date (12the “Survival Period”), (i) months following the Closingif there have been no indemnification payments to or claims made by PUB Indemnified Person(s) in accordance with Article 9, the Escrow Agent shall pay and disburse release to the Partnership, via a draw on Shareholders’ Representative from the funds available under Indemnification Escrow Amount the Escrow Letter amount of Credit, the Initial Indemnity Release Amount calculated $140,000; (ii) if there have been indemnification payments to or claims made by PUB Indemnified Person(s) in accordance with Section 2.13Article 9, and then the Escrow Agent shall release to the Shareholders’ Representative from the Indemnification Escrow Amount the amount available to be drawn under of $140,000 less the Escrow Letter of Credit and the aggregate principal amount of the Escrow Letter of Credit shall be reduced to reflect the foregoing draw and paymentany such indemnification payments or pending claims. (c) Notwithstanding anything in this Agreement or in Within five days following the Escrow Agreement to resolution and payment of any indemnification claims that were pending at the contraryend of the Survival Period, in the event that the Partnership is entitled, pursuant to this Agreement and the Escrow Agreement, to funds to be drawn from the Escrow Letter of Credit and the Escrow Agent is not able shall release to draw all or any part of the Shareholders’ Representative such funds remaining amount from the Indemnification Escrow Letter of Credit after receiving a notice (formatted as a joint written instruction) directing it to draw and release such funds, whether due to the expiration of the Escrow Letter of Credit, technical draw issues or otherwise, then, and in any such event, Purchaser shall deliver to the Partnership, by wire transfer of immediately available funds, not later than three (3) business days (with time of the essence) after a written request therefor from the Partnership, Amount provided that the amount of funds to which the Partnership is entitled or, if less than $360,000 shall remain in such amount, the remaining amount available to be drawn under the Escrow Letter of Credit, and the amount available to be drawn thereafter under the Escrow Letter of Credit (if not already equal to Zero) shall be reduced by the amount of such wire transfer. Without limiting the forgoing, any inability of the Escrow Agent to draw upon the Escrow Letter of Credit for any amount that is properly payable to the Partnership from the Escrow Letter of Credit or the Indemnity Escrow Account pursuant to this Agreement and the Escrow Agreement shall not relieve the Purchaser from its obligation to have made or to make such payment to the Partnership, and the Purchaser shall effect such payment by wire transfer in accordance with the preceding sentenceescrow account. (d) If either Purchaser or the Partnership anticipates that there will be On December 31, 2017, any funds remaining under the Escrow Letter of Credit as portion of the expiration date of the Indemnification Escrow Letter of Credit (the “Escrow L/C Expiration”), then Purchaser Amount shall use reasonable best efforts to obtain and deliver be released to the Escrow AgentShareholders’ Representative, provided that if there is any pending claim at least three (3) business days prior to the Escrow L/C Expiration, a replacement clean, irrevocable and unconditional standby letter of credit in the aggregate face amount equal to the amount of funds remaining under the Escrow Letter of Credit that date (i) in substantially the same form as the Escrow Letter of Credit with respect to a SERP Matter (defined below), or such other form as is reasonably acceptable to the Partnership and the Escrow Agent and (ii) from that was pending at the then-current lender under end of the Escrow Letter of Credit or such other lender as is reasonably acceptable to the Partnership (the “Replacement Letter of Credit”). The Escrow Agreement shall provide that if the Escrow Agent has not received a Replacement Letter of Credit from Purchaser and written notice from the Partnership that the Replacement Letter of Credit satisfies the requirements of this Section 2.12(d) at least six (6) business days prior to the Escrow L/C ExpirationSurvival Period, then prior to the close of business on the third (3rd) business day prior to the Escrow L/C Expiration (with time of the essence), the Escrow Agent a sufficient amount shall draw all funds remaining under the Escrow Letter of Credit and hold such funds be retained in the Indemnity Escrow Account for release pursuant account with respect to the applicable provisions such pending claim, provided that any remaining amount will be released within five (5) days after final resolution of the Escrow Agreement (a “Full Draw Event”). Following the expiration of the Escrow Letter of Credit, all references in this Agreement and the Escrow Agreement to the Escrow Letter of Credit shall be deemed to refer to the Replacement Letter of Credit (and any subsequent replacement standby letter of credit that complies with this Section 2.12(d)), and this Section 2.12(d) shall apply to the Replacement Letter of Credit mutatis mutandissuch pending claim. (e) The Parties agree On receiving any distribution with respect to the Indemnification Escrow Amount pursuant to the above provisions, the Shareholders’ Representative shall distribute to each holder of LB Common Shares that has delivered all of the Escrow Agreement shall treat materials required by Section 2.9(d) and is thus entitled to receive PUB Common Shares and/or cash in connection with the Escrow Letter Merger an amount equal to the product of Credit and any funds held in (a) the amount of the Indemnity Escrow Account Amount to be delivered at such time in accordance with Article 9 to the Shareholders’ Representative, multiplied by (b) the quotient obtained by dividing (i) the total number of shares of LB Common Shares held by such holder immediately prior to the Closing by (ii) the total number of LB Common Shares held by all shareholders that were outstanding immediately prior to the Closing. Any portion of the Indemnity Escrow Amount delivered to the Shareholders’ Representative that is not delivered to the shareholders of LB pursuant to the prior sentence shall be delivered to PUB and shall be treated in the same manner as owned portions of the Exchange Fund that remain unclaimed by the Partnership for U.S. federal income tax purposesshareholders of LB under Section 2.9(a).

Appears in 1 contract

Samples: Merger Agreement (People's Utah Bancorp)

Indemnification Escrow. (a) The parties agree that the Indemnification Escrow Deposit Amount, or from and shall be released as contemplated by this Section 7.11. Within five (5) Business Days after the Closing Expiration Date, the Remaining Escrow Deposit Amount, shall (subject to the terms Buyer and conditions of Article 6) serve as and be the sole and exclusive source for payment of claims for indemnification by any Purchaser Indemnitee pursuant to Article 6. The Escrow Letter of Credit, which shall be provided at the Closing by Purchaser Roccat will deliver joint written instructions to the Escrow Agent in respect of the Escrow Deposit Amount, shall be held by directing the Escrow Agent to release to the Sellers any amounts in an account the Indemnification Escrow Account in excess of the sum of (x) [**] (being [**] of the “Indemnity original Indemnification Escrow Account”Amount) plus (y) the aggregate amount of all unresolved indemnification claims by Buyer Indemnitees and within five (5) Business Days after the Extended Date, the Buyer and Roccat will deliver joint written instructions to the Escrow Agent directing the Escrow Agent to release to the Sellers the remaining amounts of the Indemnification Escrow subject to the following conditions. (b) For the avoidance of doubt, the Buyer and Roccat agree that no joint instructions contemplated by this Section 7.11 shall be delivered to the Escrow Agent with respect to any amount that is subject to a claim for indemnification which has been delivered in accordance with this Section 7.11. Upon the terms resolution of any such claim, either by mutual agreement of the parties or upon a final determination of an arbitrator as contemplated by Section 11.8, then the Buyer and conditions Roccat shall deliver a joint written instruction to the Escrow Agent regarding (i) any Damages to be paid to the Buyer from the Indemnification Escrow Account or (ii) any portion of the Indemnification Escrow Account to be paid to the Sellers which otherwise should have been released to such parties on the Expiration Date or Extended Date, but for such claim. (c) Prior to Closing, the parties will negotiate in good faith an escrow agreement in the form attached hereto as Exhibit G (the “Escrow Agreement”). (b) On the date which is twelve (12) months following the Closing, the Escrow Agent shall pay and disburse to the Partnership, via a draw on the funds available under the Escrow Letter of Credit, the Initial Indemnity Release Amount calculated in accordance with Section 2.13, and the amount available to be drawn under the Escrow Letter of Credit and the aggregate principal amount of the Escrow Letter of Credit shall be reduced to reflect the foregoing draw and payment. (c) Notwithstanding anything in this Agreement or in the Escrow Agreement to the contrary, in the event that the Partnership is entitled, pursuant to this Agreement and the Escrow Agreement, to funds to be drawn from the Escrow Letter of Credit and the Escrow Agent is not able to draw all or any part of such funds from the Escrow Letter of Credit after receiving a notice (formatted as a joint written instruction) directing it to draw and release such funds, whether due to the expiration of the Escrow Letter of Credit, technical draw issues or otherwise, then, and in any such event, Purchaser shall deliver to the Partnership, by wire transfer of immediately available funds, not later than three (3) business days (with time of the essence) after a written request therefor from the Partnership, the amount of funds to which the Partnership is entitled or, if less than such amount, the remaining amount available to be drawn under the Escrow Letter of Credit, and the amount available to be drawn thereafter under the Escrow Letter of Credit (if not already equal to Zero) shall be reduced by the amount of such wire transfer. Without limiting the forgoing, any inability of the Escrow Agent to draw upon the Escrow Letter of Credit for any amount that is properly payable to the Partnership from the Escrow Letter of Credit or the Indemnity Escrow Account pursuant to this Agreement and the Escrow Agreement shall not relieve the Purchaser from its obligation to have made or to make such payment to the Partnership, and the Purchaser shall effect such payment by wire transfer in accordance with the preceding sentence. (d) If either Purchaser or the Partnership anticipates that there will be any funds remaining under the Escrow Letter of Credit as of the expiration date of the Escrow Letter of Credit (the “Escrow L/C Expiration”), then Purchaser shall use reasonable best efforts to obtain and deliver to the Escrow Agent, at least three (3) business days prior to the Escrow L/C Expiration, a replacement clean, irrevocable and unconditional standby letter of credit in the aggregate face amount equal to the amount of funds remaining under the Escrow Letter of Credit (i) in substantially the same customary form as the Escrow Letter of Credit or such other form as is for comparable transactions reasonably acceptable to the Partnership and parties thereto (the draft currently under negotiation is attached as Exhibit L) reflecting the provisions of this Section 7.11. The parties agree that they will issue any joint instructions to the Escrow Agent and (ii) from the then-current lender that are required to issue under this Agreement or under the Escrow Letter of Credit or such other lender as is reasonably acceptable to the Partnership (the “Replacement Letter of Credit”). The Escrow Agreement shall provide that if the Escrow Agent has not received a Replacement Letter of Credit from Purchaser promptly and written notice from the Partnership that the Replacement Letter of Credit satisfies the requirements of this Section 2.12(d) at least six (6) business days prior to the Escrow L/C Expiration, then prior to the close of business on the third (3rd) business day prior to the Escrow L/C Expiration (with time of the essence), the Escrow Agent shall draw all funds remaining under the Escrow Letter of Credit and hold such funds in the Indemnity Escrow Account for release pursuant to the applicable provisions of the Escrow Agreement (a “Full Draw Event”). Following the expiration of the Escrow Letter of Credit, all references in this Agreement and the Escrow Agreement to the Escrow Letter of Credit shall be deemed to refer to the Replacement Letter of Credit (and any subsequent replacement standby letter of credit that complies with this Section 2.12(d)), and this Section 2.12(d) shall apply to the Replacement Letter of Credit mutatis mutandiswithout undue delay. (e) The Parties agree that the Escrow Agreement shall treat the Escrow Letter of Credit and any funds held in the Indemnity Escrow Account as owned by the Partnership for U.S. federal income tax purposes.

Appears in 1 contract

Samples: Asset Purchase Agreement (Turtle Beach Corp)

Indemnification Escrow. (ai) Prior to 11:59 p.m. (PST) on the date that is eighteen (18) months after the Closing (the “Termination Time”), Acquiror may deliver to Stockholders’ Agent and the Escrow Agent a written certificate signed by the Chief Financial Officer or other senior officer of Acquiror (an “Officer’s Certificate”) stating that in its good faith determination Acquiror is entitled to be indemnified, in the amount set forth in the Officer’s Certificate (the “Damages”) pursuant to Section 9.2(b) of the Merger Agreement, and specifying in reasonable detail the reasons therefor and the individual items of such Damages included in the amount so stated and the nature of the misrepresentation, breach of warranty, covenant or claim to which such item is related. (ii) The Escrow Deposit AmountAgent shall not be responsible for making any assessments of the Officer’s Certificate and shall, or from and after the Closing the Remaining Escrow Deposit Amount, shall (subject to the terms and conditions of Article 6this Escrow Agreement, be entitled to rely conclusively upon its contents. Subject to clause (iii), the aggregate amount of all Damages specified in an Officer’s Certificate shall not be released from the Indemnification Escrow with respect to such claims until the claims related to such Damages have been finally resolved and either (1) serve as and be the sole and exclusive source for payment of claims for indemnification by any Purchaser Indemnitee pursuant to Article 6. The Escrow Letter of Credit, which shall be provided at the Closing by Purchaser to the Escrow Agent in respect of receives a joint written instruction regarding the Escrow Deposit Amount, shall Damages to be held by released hereunder or (2) the Escrow Agent in an account receives a certified copy of a final and non-appealable judgment of a competent court of jurisdiction stating that it is final with respect to the Damages at issue (the a Indemnity Escrow Account”) in accordance with the terms and conditions of an escrow agreement in the form attached hereto as Exhibit G (the “Escrow AgreementJudgment”). (b) On the date which is twelve (12) months following the Closing, the Escrow Agent shall pay and disburse to the Partnership, via a draw on the funds available under the Escrow Letter of Credit, the Initial Indemnity Release Amount calculated in accordance with Section 2.13, and the amount available to be drawn under the Escrow Letter of Credit and the aggregate principal amount of the Escrow Letter of Credit shall be reduced to reflect the foregoing draw and payment. (ciii) Notwithstanding anything in this Agreement or in the Escrow Agreement to the contraryclause (ii), in the event that the Partnership is entitledwithin thirty (30) days from and after receipt of an Officer’s Certificate, pursuant to this Agreement and the Escrow Agreement, to funds to be drawn from the Escrow Letter of Credit and the Escrow Stockholders’ Agent is does not able to draw all or any part of such funds from the Escrow Letter of Credit after receiving a notice (formatted as a joint written instruction) directing it to draw and release such funds, whether due to the expiration of the Escrow Letter of Credit, technical draw issues or otherwise, then, and in any such event, Purchaser shall deliver to the Partnership, by wire transfer of immediately available funds, not later than three (3) business days (with time of the essence) after provide a written request therefor from the Partnership, the amount of funds objection (a “Stockholder Objection”) to which the Partnership is entitled or, if less than such amount, the remaining amount available to be drawn under the Escrow Letter of Credit, and the amount available to be drawn thereafter under the Escrow Letter of Credit (if not already equal to Zero) shall be reduced by the amount of such wire transfer. Without limiting the forgoing, any inability of the Escrow Agent to draw upon the Escrow Letter of Credit for any amount that is properly payable to the Partnership from the Escrow Letter of Credit or the Indemnity Escrow Account pursuant to this Agreement and the Escrow Agreement shall not relieve the Purchaser from its obligation to have made or to make such payment to the Partnership, and the Purchaser shall effect such payment by wire transfer in accordance with the preceding sentence. (d) If either Purchaser or the Partnership anticipates that there will be any funds remaining under the Escrow Letter of Credit as of the expiration date of the Escrow Letter of Credit (the “Escrow L/C Expiration”), then Purchaser shall use reasonable best efforts to obtain and deliver to the Escrow Agent, at least three (3) business days prior to the Escrow L/C Expiration, a replacement clean, irrevocable and unconditional standby letter of credit in the aggregate face amount equal to the amount of funds remaining under the Escrow Letter of Credit (i) in substantially the same form as the Escrow Letter of Credit or such other form as is reasonably acceptable to the Partnership and the Escrow Agent and (ii) from the then-current lender under the Escrow Letter of Credit Acquiror with respect to one or such other lender as is reasonably acceptable to the Partnership (the “Replacement Letter of Credit”). The Escrow Agreement shall provide that if the Escrow Agent has not received a Replacement Letter of Credit from Purchaser and written notice from the Partnership that the Replacement Letter of Credit satisfies the requirements of this Section 2.12(d) at least six (6) business days prior to the Escrow L/C Expiration, then prior to the close of business on the third (3rd) business day prior to the Escrow L/C Expiration (with time more of the essenceclaims set forth in an Officer’s Certificate (each such non-disputed claim, a “Non-Disputed Claims”), the Escrow Agent shall draw all funds remaining under the Escrow Letter of Credit and hold such funds in the Indemnity Escrow Account for release pursuant disburse to the applicable provisions Acquiror, on behalf of the Escrow Agreement (a “Full Draw Event”). Following Acquiror Indemnified Persons, the expiration amount of the Escrow Letter of Credit, all references Damages set forth in this Agreement and the Escrow Agreement to the Escrow Letter of Credit shall be deemed to refer to the Replacement Letter of Credit (and any subsequent replacement standby letter of credit such Officer’s Certificate that complies with this Section 2.12(d)), and this Section 2.12(d) shall apply to the Replacement Letter of Credit mutatis mutandisarise from each Non-Disputed Claim. (eiv) The Parties agree In the event that within thirty (30) days from and after receipt of an Officer’s Certificate, Stockholders’ Agent provides a Stockholder Objection with respect to one or more of the claims set forth in an Officer’s Certificate (each such disputed claim, a “Disputed Claims”), the Escrow Agreement Agent shall treat not release from the Indemnification Escrow the amount of Damages set forth in such Officer’s Certificate that arise from each Disputed Claim until such Disputed Claims have been finally resolved and either (1) the Escrow Letter Agent receives a joint written instruction regarding the Damages to be released hereunder or (2) the Escrow Agent receives a certified copy of Credit and a Judgment; provided that this clause (iv) shall not prevent the Escrow Agent from disbursing funds from the Indemnification Escrow to Acquiror in satisfaction of any funds held in the Indemnity Escrow Account as owned by the Partnership for U.S. federal income tax purposesNon-Disputed Claim or any Disputed Claim that has been finally resolved.

Appears in 1 contract

Samples: Merger Agreement (Nuvasive Inc)

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