Limitations on Indemnification Obligations. (a) The amount which any Party (an "Indemnifying Party") is or may be required to pay to any Person (an "Indemnified Party") in respect of Damages or other Liability for which indemnification is provided under this Agreement shall be reduced by any amounts actually received (including Insurance Proceeds actually received) by or on behalf of such Indemnified Party (net of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after the full amount of such Damages has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such Damages, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made. (b) In determining the amount of any indemnity payment under this Agreement, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated. (c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000). (d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 4 contracts
Samples: Asset Purchase Agreement (Conexant Systems Inc), Asset Purchase Agreement (Skyworks Solutions Inc), Asset Purchase Agreement (Alpha Industries Inc)
Limitations on Indemnification Obligations. (a) REDUCTIONS FOR INSURANCE PROCEEDS AND OTHER RECOVERIES. The amount which that any Party party (an "Indemnifying PartyINDEMNIFYING PARTY") is or may be required to pay to any other Person (an "Indemnified PartyINDEMNITEE") in respect of Damages pursuant to Section 7.01 or other Liability for which indemnification is provided under this Agreement Section 7.02 above, as applicable, shall be reduced (retroactively or prospectively) by any Insurance Proceeds or other amounts actually received (including Insurance Proceeds actually received) recovered from third parties by or on behalf of such Indemnified Party (net of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) Indemnitee in respect of such Damages the related Indemnifiable Losses. The existence of a claim by an Indemnitee for insurance or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts against a third party in respect of Damages for which any Indemnifiable Loss shall not, however, delay any payment pursuant to the indemnification is provided under this Agreement after the full amount of such Damages has been paid provisions contained herein and otherwise determined to be due and owing by an Indemnifying Party or after an Party. Rather, the Indemnifying Party has made a partial shall make payment in full of such Damages amount so determined to be due and such Indemnity Reduction Amounts exceed owing by it against an assignment by the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit Indemnitee to the Indemnifying Party of the entire claim of the Indemnitee for such insurance or against such third party. Notwithstanding any other provisions of this Agreement, it is the intention of the parties hereto that no insurer or any other third party shall be (i) entitled to a benefit it would not be entitled to receive in the absence of the foregoing indemnification provisions, (ii) relieved of the responsibility to pay any claims for which it is obligated or (iii) entitled to any subrogation rights with respect to any obligation hereunder. If an amount equal to Indemnitee shall have received the excess (if any) of (A) the amount theretofore paid payment required by the this Agreement from an Indemnifying Party in respect of any Indemnifiable Losses and shall subsequently actually receive Insurance Proceeds or other amounts in respect of such DamagesIndemnifiable Losses, less (B) then such Indemnitee shall hold such Insurance Proceeds in trust for the benefit of such Indemnifying Party and shall pay to such Indemnifying Party a sum equal to the amount of such Insurance Proceeds or other amounts actually received, up to the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the aggregate amount of any indemnity payment under this Agreement, payments received from such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Indemnifying Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)Indemnifiable Losses.
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 4 contracts
Samples: Distribution Agreement (Tenneco Packaging Inc), Distribution Agreement (Tenneco Packaging Inc), Distribution Agreement (Tenneco Packaging Inc)
Limitations on Indemnification Obligations. (a) The amount which any Party party (an "Indemnifying Party") is or may be required to pay to any Person (an "Indemnified Party") Indemnitee in respect of Damages Indemnifiable Losses or other Liability for which indemnification is provided under this Agreement shall be reduced by any amounts actually received (including Insurance Proceeds actually received) by or on behalf of such Indemnified Party Indemnitee (net of increased insurance premiums and charges to the extent related to Damages Indemnifiable Losses and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party Indemnitee in connection with seeking to collect and collecting such amounts) in respect of such Damages Indemnifiable Losses or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party Indemnitee receives any Indemnity Reduction Amounts in respect of Damages an Indemnifiable Loss for which indemnification is provided under this Agreement after the full amount of such Damages Indemnifiable Loss has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages Indemnifiable Loss and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such DamagesIndemnifiable Loss, then the Indemnified Party Indemnitee shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such DamagesIndemnifiable Loss, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the amount of any indemnity payment under this AgreementIndemnifiable Losses, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates Indemnitee arising from the incurrence or payment by the Indemnified Party or its Affiliates Indemnitee of any amount in respect of which such payment is made Indemnifiable Losses and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates Indemnitee as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates Indemnitee as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereundersuch Indemnifiable Losses. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates Washington Indemnitees or the California Indemnitees, as applicable, shall be deemed to be subject to the applicable Tax as follows: (A) U.S. federal income Taxes and foreign income Taxes at the maximum statutory rate then in effecteffect and (B) U.S. state and local income Taxes at an assumed rate of five percent net of U.S. federal income Tax benefits. It is the intention of the Parties parties to this Agreement that indemnity payments made pursuant to this Agreement are to be treated as relating back to the Closing Date Distribution as a purchase price adjustmentan adjustment to capital (i.e., capital contribution or distribution), and the Parties parties shall not take any position inconsistent with such intention before any Tax authorityAuthority (as defined in the Tax Allocation Agreement), except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller Conexant to any Purchaser Indemnified Party Washington Indemnitee with respect to the indemnification of any claims pursuant to Section 8.1(i4.02(d) until the aggregate amount of Damages Indemnifiable Losses actually incurred by the Purchaser Indemnified Parties Washington Indemnitees with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand One Million Five Hundred Thousand dollars (U.S.$50,000$1,500,000), in which event Seller Conexant shall be responsible only for the amount of such Damages Indemnifiable Losses in excess of fifty thousand One Million Five Hundred Thousand dollars (U.S.$50,000$1,500,000). .
(d) No monetary amount will be payable by Seller Conexant to any Purchaser Indemnified Party Washington Indemnitee with respect to the indemnification of any claims pursuant to Section 8.1(i4.02(d) after the aggregate amount of Damages Indemnifiable Losses actually paid by Seller Conexant with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand Fifteen Million dollars (U.S.$500,000$15,000,000).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 4 contracts
Samples: Contribution and Distribution Agreement (Conexant Systems Inc), Contribution and Distribution Agreement (Alpha Industries Inc), Contribution and Distribution Agreement (Conexant Systems Inc)
Limitations on Indemnification Obligations. (a) The Parties intend that any Liability subject to indemnification, contribution or reimbursement pursuant to this Article IV or Article V will be net of Insurance Proceeds or other amounts actually recovered (net of any out-of-pocket costs or expenses incurred in the collection thereof) from any Person by or on behalf of the Indemnitee in respect of any indemnifiable Liability. Accordingly, the amount which any either Party (an "“Indemnifying Party"”) is or may be required to pay to any Person entitled to indemnification or contribution hereunder (an "Indemnified Party"“Indemnitee”) in respect of Damages or other Liability for which indemnification is provided under this Agreement shall will be reduced by any Insurance Proceeds or other amounts actually received recovered (including Insurance Proceeds actually receivednet of any out-of-pocket costs or expenses incurred in the collection thereof) from any Person by or on behalf of such Indemnified Party (net of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) Indemnitee in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts")the related Liability. If any Indemnified an Indemnitee receives a payment (an “Indemnity Payment”) required by this Agreement from an Indemnifying Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after any Liability and subsequently receives Insurance Proceeds or any other amounts in respect of the full amount of such Damages has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such Damagesrelated Liability, then the Indemnified Party shall promptly remit Indemnitee will pay to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such Damages, less (B) Indemnity Payment received over the amount of the indemnity payment Indemnity Payment that would have been due if the Insurance Proceeds or such Indemnity Reduction Amounts other amounts (net of any out-of-pocket costs or expenses incurred in respect thereof the collection thereof) had been received received, realized or recovered before the indemnity payment Indemnity Payment was made.
(b) In determining The Parties agree that an insurer that would otherwise be obligated to pay any claim shall not be relieved of the amount responsibility with respect thereto or, solely by virtue of any indemnity provision contained in this Agreement or any Ancillary Agreement, have any subrogation rights with respect thereto, it being understood that no insurer or any other Third Party shall be entitled to a “windfall” (i.e., a benefit they would not be entitled to receive in the absence of the indemnification provisions) by virtue of the indemnification and contribution provisions hereof. Each Party shall, and shall cause the members of its Group to, use commercially reasonable efforts (taking into account the probability of success on the merits and the cost of expending such efforts, including attorneys’ fees and expenses) to collect or recover any Insurance Proceeds that may be collectible or recoverable respecting the Liabilities for which indemnification or contribution may be available under this Article IV. Notwithstanding the foregoing, an Indemnifying Party may not delay making any indemnification payment required under the terms of this Agreement, such amount shall be (i) reduced to take into account or otherwise satisfying any net Tax benefit realized by indemnification obligation, pending the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates outcome of any amount in respect of which such payment is made and (ii) increased Action to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt collect or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustmentrecover Insurance Proceeds, and the Parties shall an Indemnitee need not take attempt to collect any position inconsistent with such intention before Insurance Proceeds prior to making a claim for indemnification or contribution or receiving any Tax authority, except Indemnity Payment otherwise owed to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes it under any such payment not to be so treatedTransaction Document.
(c) No monetary amount will The Parties agree that no Indemnitee shall be payable by Seller entitled to indemnification, contribution or reimbursement pursuant to this Article IV for any Purchaser Indemnified Party with respect special, punitive or exemplary damages, except, in each case, to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to extent such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages damages are finally awarded and actually paid by Seller the Indemnitee to a Third Party in connection with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)Third-Party Claim.
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 3 contracts
Samples: Separation and Distribution Agreement (Istar Inc.), Separation and Distribution Agreement (Star Holdings), Merger Agreement (Istar Inc.)
Limitations on Indemnification Obligations. The rights of the Buyer Indemnitees and Seller Indemnitees to indemnification pursuant to the provisions of Section 9.2 are subject to the following limitations:
(a) The amount which of any Party and all Losses will be determined net of (an "Indemnifying Party"i) is any accruals or may be required to pay to any Person reserves on the Recent Balance Sheet, (an "Indemnified Party"ii) in respect of Damages or other Liability for which indemnification is provided under this Agreement shall be reduced by any amounts actually received recovered by the Buyer Indemnitees or the Seller Indemnitees, as the case may be, under indemnification agreements or arrangements with third parties or under insurance policies with respect to such Losses (including Insurance Proceeds actually receivedand no right of subrogation shall accrue to any such third party indemnitor or insurer hereunder) by (each such source named in this clause (ii) a “Collateral Source”). Seller or on behalf Buyer may, in its sole discretion, require any Indemnified Party to grant an assignment of the right of such Indemnified Party (net of increased insurance premiums and charges to assert a claim against any Collateral Source, to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such the Indemnified Party in connection with seeking is permitted to collect and collecting grant such amounts) in respect of such Damages assignment under the applicable indemnification agreement or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts")arrangement or insurance policy. If the amount to be netted hereunder from any payment required under Sections 9.2(a) or 9.2(b) is determined after payment of any amount otherwise required to be paid to an Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after the full amount of such Damages has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such DamagesArticle IX, then the Indemnified Party shall promptly remit repay to the Indemnifying Party Responsible Parties, promptly after such determination, any amount that the Responsible Parties would not have had to pay pursuant to this Article IX had such determination been made at the time of such payment.
(b) The amount of any Loss will be determined (i) net of an amount equal to the excess (if any) of (A) the amount theretofore paid Tax benefits actually realized in cash by the Indemnifying Party Buyer Indemnitees or the Seller Indemnitees, as the case may be, in respect of the year during which such Damages, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment Loss was made.
(b) In determining the amount of any indemnity payment under this Agreement, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party suffered and its Affiliates arising from the incurrence facts or payment by the Indemnified Party or its Affiliates of any amount in respect of which circumstances giving rise to such payment is made Loss and (ii) increased to take taking into account any net Tax cost actually incurred or suffered by the Indemnified Party and its Affiliates Buyer Indemnitees or Seller Indemnitees, as a result of the case may be, arising from the receipt or accrual of the indemnification payment.
(c) The Buyer Indemnitees shall not be entitled to recover under Section 9.2 that portion of any Loss solely to the extent specifically reflected and identified as such in the calculation of Net Working Capital.
(d) The Buyer Indemnitees and the Seller Indemnitees, as the case may be, shall not be entitled to recover for any particular Loss pursuant to Section 6.8(h)(i)(C), Section 9.2(a)(i) or Section 9.2(b)(i), as the case may be, unless such Loss (or series of related Losses) equals or exceeds One Hundred Thousand Dollars ($100,000); provided, however, that this limitation shall not apply to Losses in respect of claims for breach of representations and warranties related to Section 4.5 or pursuant to Section 9.2(a)(iii), Section 9.2(a)(iv), Section 9.2(b)(ii) or Section 9.2(b)(iii).
(e) The Buyer Indemnitees and the Seller Indemnitees, as the case may be, will not be entitled to recover Losses pursuant to Section 9.2(a)(i), Section 9.2(a)(ii), or Section 9.2(b)(i), as the case may be, until the total amount which the Buyer Indemnitees or the Seller Indemnitees, as the case may be, would recover under Section 9.2(a)(i), Section 9.2(a)(ii) or Section 9.2(b)(i), as the case may be (as limited by the provisions of Sections 9.4(a) through 9.4(d)), but for this Section 9.4(e), exceeds Ten Million Dollars ($10,000,000) (the “Threshold”) and then only for the excess over the Threshold; provided, however, that the Threshold shall not apply to Losses in respect of claims for breach of representations and warranties related to Section 4.5 or pursuant to Section 9.2(a)(iii), Section 9.2(a)(iv), Section 9.2(b)(ii) or Section 9.2(b)(iii).
(f) Notwithstanding anything herein to the contrary, (A) the maximum aggregate obligation of Seller or Buyer, as the case may be, for (i) breaches of covenants and agreements under Section 6.8(h)(i)(D) (and to the extent relating thereto, Section 6.8(h)(i)(E)), Section 6.8(h)(ii)(A) (and to the extent relating thereto, Section 6.8(h)(ii)(C)), Section 9.2(a)(iii) or Section 9.2(a)(iv) or Section 9.2(b)(ii) or Section 9.2(b)(iii) and (ii) claims for indemnification under Section 9.2(a) for Losses in respect of claims for breach of representations and warranties related to Section 4.5 shall not exceed the Purchase Price and (B) the maximum aggregate obligation of Seller or Buyer, as the case may be, for claims for indemnification under Section 6.8(h)(i) (other than Section 6.8(h)(i)(D) (and to the extent relating thereto, Section 6.8(h)(i)(E)) and Section 6.8(h)(ii) (other than Section 6.8(h)(ii)(A) (and to the extent relating thereto, Section 6.8(h)(ii)(C))) shall not exceed Five Hundred Million Dollars ($500,000,000).
(g) Except with respect to claims for indemnification under Section 9.2(a) for breach of representations and warranties set forth in Section 4.5, which indemnification shall be limited as set forth in Section 9.4(f), at no time will the Buyer Indemnitees be entitled to recover more than Ninety Million Dollars ($90,000,000) pursuant to Section 9.2(a)(i) or Section 9.2(a)(ii), and at no time will the Seller Indemnitees be entitled to recover more than Ninety Million Dollars ($90,000,000) pursuant to Section 9.2(b)(i).
(h) To the extent that any Buyer Indemnitee is entitled to any indemnification payments hereunder from Seller for claims for indemnification under Section 9.2(a)(i) or Section 9.2(a)(ii) other than claims for indemnification under Section 9.2(a)(ii) in respect of a breach of representations and warranties set forth in Section 4.5, such indemnification payments shall be disbursed to such Buyer Indemnitee from the Escrow Funds to the extent sufficient funds are available from the Escrow Funds, with any deficiency being paid by Seller.
(grossed-up i) To the extent that any Buyer Indemnitee is entitled to any indemnification payments from Seller under Section 6.8(h), under Section 9.2(a)(ii) in respect of claims for such increase)a breach of representations and warranties set forth in Section 4.5, under Section 9.2(a)(iii) or under Section 9.2(a)(iv) then, in each case determined such case, any such Losses may be satisfied, at Buyer’s option, by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of cash in the Escrow Account, with any such Tax benefit deficiency being paid by Seller.
(j) Notwithstanding anything contained herein to the contrary, nothing in Section 9.4 shall limit any Person’s rights to recovery in respect of fraud or Tax costwillful misconduct.
(k) For purposes of Sections 9.2(a)(i), 9.2(a)(ii) and 9.2(b)(i) only: (i) all references to “Material Adverse Effect” contained in the Indemnified Party Company’s or the Seller’s representations and its Affiliates warranties in Article III and Article IV hereof (other than in Section 3.7) shall be deemed to be subject references to “material to the applicable Taxes at Company”; and (ii) all references to “material” contained in the maximum statutory rate then Company’s or the Seller’s representations and warranties in effect. It is the intention of the Parties Article III and Article IV hereof (including references to this Agreement that payments made pursuant to this Agreement are to be treated as relating back “material to the Closing Date Company” as a purchase price adjustment, result of clause (i) of this Section 9.4(k)) and any references to “Material Adverse Effect” contained in the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined Company’s and Seller’s representations and warranties in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller 3.7 hereof shall be responsible only taken into account solely for purposes of determining whether such representations or warranties have been breached or violated, but not for purposes of determining of calculating the amount Loss resulting from such breach or violation or for purposes of determining whether the Threshold has been exceeded (it being agreed that, for both of such Damages purposes, all qualifications as to Material Adverse Effect and materiality contained in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will the Company’s or the Seller’s representations and warranties shall be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000ignored).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 3 contracts
Samples: Acquisition Agreement, Acquisition Agreement, Stock Purchase Agreement (Cardinal Health Inc)
Limitations on Indemnification Obligations. (a) The amount which Seller shall not be obligated to indemnify Purchaser for any Party (an "Indemnifying Party") is or may be required to pay to any Person (an "Indemnified Party") in respect of Damages Losses incurred by Purchaser or other Liability Indemnified Parties of the Purchaser under Section 8.2 until the Losses for which Purchaser is entitled to indemnification is provided under this Agreement exceed $150,000 in the aggregate, in which case, upon exceeding such threshold amount, Purchaser shall be reduced entitled to recover all such Losses (including such initial threshold amount). Except as expressly provided in the next sentence of this Section 8.7(a), notwithstanding anything contained in this Agreement to the contrary, in no event shall Seller’s liability for Losses under Section 8.2(a) exceed, in the aggregate, $16,666,666.67; in no event shall Seller’s liability for Losses under Section 8.2(b) (other than Sections 8.2(b)(iv) and (b)(v)) exceed, in the aggregate, the Purchase Price; and in no event shall Purchaser’s liability for Losses under Section 8.2(c) exceed, in the aggregate, the Purchase Price. The provisions of this Section 8.7(a) shall not apply to either party’s indemnification obligations under this Agreement arising out of, relating to or resulting from fraud by such party.
(b) Notwithstanding anything contained in this Agreement to the contrary, the amount of an Indemnifying Party’s liability pursuant to this Section 8 shall be net of any insurance proceeds or other third party indemnity or contribution amounts actually received (including Insurance Proceeds actually received) recovered by or on behalf of such an Indemnified Party. Each Indemnified Party (net of increased shall use commercially reasonable efforts to collect any such insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred proceeds or other third party indemnity or contribution amounts recoverable by such Indemnified Party Party, and in connection with seeking to collect and collecting the event any such amounts) in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages collected after a claim for which indemnification is provided under this Agreement after the full amount of such Damages Losses has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such DamagesParty, then the Indemnified Party shall promptly remit reimburse such amounts to the such Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such Damages, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the amount of any indemnity payment under this Agreement, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treatedParty.
(c) No monetary amount will Notwithstanding anything to the contrary contained in this Agreement, no Indemnifying Party shall be payable by Seller liable to any Purchaser an Indemnified Party with for any indirect, special, punitive, exemplary or consequential loss or damage (including any loss of opportunity or loss of value, revenue or profit) arising out of this Agreement; provided, however, that the foregoing shall not be construed to preclude recovery by an Indemnified Party in respect to the indemnification of any claims such Losses either (i) directly incurred as a result of a Third Party Claim or (ii) relating to or in connection with any Losses for which Purchaser is entitled to indemnification pursuant to Section 8.1(i8.2(b)(iv) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000or 8.2(b)(v).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 3 contracts
Samples: Purchase and Sale Agreement (Netlogic Microsystems Inc), Purchase and Sale of Assets Agreement (Cypress Semiconductor Corp /De/), Purchase and Sale Agreement (Cypress Semiconductor Corp /De/)
Limitations on Indemnification Obligations. (ai) The amount which that any Party party (an "“Indemnifying Party"”) is or may be required to pay to any Person other person (an "Indemnified Party"“Indemnitee”) in respect pursuant to paragraphs (a), (b) or (c) of Damages or other Liability for which indemnification is provided under this Agreement Section 16, as applicable, shall be reduced (retroactively or prospectively) by any Insurance Proceeds or other amounts actually received (including Insurance Proceeds actually received) recovered by or on behalf of such Indemnified Party (net of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) Indemnitee in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts")the related Indemnifiable Loss. If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under an Indemnitee shall have received the payment required by this Agreement after the full amount of such Damages has been paid by from an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of an Indemnifiable Loss and shall subsequently actually receive Insurance Proceeds or other amounts in respect of such DamagesIndemnifiable Loss, less (B) then such Indemnitee shall pay to such Indemnifying Party a sum equal to the amount of such Insurance Proceeds or other amounts actually received, up to the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the aggregate amount of any indemnity payment under this Agreement, payments received from such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Indemnifying Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties in respect of such Indemnifiable Loss.
(ii) An Indemnifying Party shall not take be required to indemnify or pay an Indemnitee pursuant to paragraphs (a), (b) or (c) of this Section 16, as applicable, for any position inconsistent Indemnifiable Losses relating to or associated with such intention before any Tax authorityemployee benefit plan, except to the extent that a final determination (as defined in Section 1313 policy, program or arrangement of the CodeIndemnifying Party arising out of, by reason of or otherwise in connection with any act or failure to act on the part of such Indemnitee (including for this purpose any subsidiaries, businesses or operations which become associated with the Indemnitee by virtue of or in connection with the Distribution) with respect to the recipient party causes or in connection with such employee benefit plan, policy, program or arrangement, including, without limitation, any such payment not act or failure to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party act in connection with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred administration by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount Indemnitee of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)employee benefit plan, policy, program or arrangement.
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 3 contracts
Samples: Benefits and Compensation Matters Agreement (Exelis Inc.), Benefits and Compensation Matters Agreement (Xylem Inc.), Benefits and Compensation Matters Agreement (Xylem Inc.)
Limitations on Indemnification Obligations. (a) REDUCTIONS FOR INSURANCE PROCEEDS AND OTHER RECOVERIES. The amount which that any Party party (an "Indemnifying PartyINDEMNIFYING PARTY") is or may be required to pay to any other Person (an "Indemnified PartyINDEMNITEE") in respect of Damages pursuant to SECTION 7.01, SECTION 7.02 or other Liability for which indemnification is provided under this Agreement SECTION 7.03 above, as applicable, shall be reduced (retroactively or prospectively) by any Insurance Proceeds or other amounts actually received (including Insurance Proceeds actually received) recovered from third parties by or on behalf of such Indemnified Party (net of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) Indemnitee in respect of such Damages or other Liability the related Indemnifiable Losses (such net amounts are referred to except that nothing herein shall be construed as "Indemnity Reduction Amounts"). If requiring any Indemnified Party receives any Indemnity Reduction Amounts Indemnitee in respect of Damages any Shipbuilding Securities Liability to file any claim for which insurance). The existence of a claim by an Indemnitee for insurance or against a third party in respect of any Indemnifiable Loss shall not, however, delay any payment pursuant to the indemnification is provided under this Agreement after the full amount of such Damages has been paid provisions contained herein and otherwise determined to be due and owing by an Indemnifying Party or after an Party. Rather the Indemnifying Party has made a partial shall make payment in full of such Damages amount so determined to be due and such Indemnity Reduction Amounts exceed owing by it against an assignment by the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit Indemnitee to the Indemnifying Party of the entire claim of the Indemnitee for such insurance or against such third party. Notwithstanding any other provisions of this Agreement, it is the intention of the parties hereto that no insurer or any other third party shall be (i) entitled to a benefit it would not be entitled to receive in the absence of the foregoing indemnification provisions or (ii) relieved of the responsibility to pay any claims for which it is obligated. If an amount equal to Indemnitee shall have received the excess (if any) of (A) the amount theretofore paid payment required by the this Agreement from an Indemnifying Party in respect of any Indemnifiable Losses and shall subsequently actually receive Insurance Proceeds or other amounts in respect of such DamagesIndemnifiable Losses, less (B) then such Indemnitee shall hold such Insurance Proceeds in trust for the benefit of such Indemnifying Party and shall pay to such Indemnifying Party a sum equal to the amount of such Insurance Proceeds or other amounts actually received, up to the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the aggregate amount of any indemnity payment under this Agreement, payments received from such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Indemnifying Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)Indemnifiable Losses.
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 3 contracts
Samples: Distribution Agreement (Newport News Shipbuilding Inc), Distribution Agreement (Newport News Shipbuilding Inc), Distribution Agreement (Newport News Shipbuilding Inc)
Limitations on Indemnification Obligations. (a) The amount which any Party (an "Indemnifying Party") is or may be required to pay to any Person (an "Indemnified Party") in respect of Damages or other Liability for which indemnification is provided under this Agreement shall be reduced by any amounts actually received (including Insurance Proceeds actually received) by or on behalf of such Indemnified Party (net of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after the full amount of such Damages has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such Damages, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the amount of any indemnity payment under this Agreement, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i9.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims, together with the aggregate amount of Damages (as defined in the Mexican Asset Purchase Agreement) actually incurred by the Purchaser Indemnified Parties (as defined in the Mexican Asset Purchase Agreement) with respect to indemnification claims pursuant to Section 9.1(i) of the Mexican Asset Purchase Agreement, shall exceed on a cumulative basis an amount equal to fifty thousand one million dollars (U.S.$50,000U.S.$1,000,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand one million dollars (U.S.$50,000U.S.$1,000,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i9.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims, together with the aggregate amount of Damages (as defined in the Mexican Asset Purchase Agreement) actually paid by Seller with respect to indemnification claims pursuant to Section 9.1(i) of the Mexican Asset Purchase Agreement, shall equal on a cumulative basis an amount equal to five hundred thousand ten million dollars (U.S.$500,000U.S.$10,000,000).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i9.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims, together with the aggregate amount of Damages (as defined in the Mexican Asset Purchase Agreement) actually incurred by the Seller Indemnified Parties (as defined in the Mexican Asset Purchase Agreement) with respect to indemnification claims pursuant to Section 9.2(i) of the Mexican Asset Purchase Agreement, shall exceed on a cumulative basis an amount equal to fifty thousand one million dollars (U.S.$50,000U.S.$1,000,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand one million dollars (U.S.$50,000U.S.$1,000,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i9.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims, together with the aggregate amount of Damages (as defined in the Mexican Asset Purchase Agreement) actually paid by Purchaser with respect to indemnification claims pursuant to Section 9.2(i) of the Mexican Asset Purchase Agreement, shall equal on a cumulative basis an amount equal to five hundred thousand ten million dollars (U.S.$500,000U.S.$10,000,000).
Appears in 2 contracts
Samples: Mexican Stock Purchase Agreement (Conexant Systems Inc), Mexican Stock Purchase Agreement (Skyworks Solutions Inc)
Limitations on Indemnification Obligations. (a) The amount which any Party party (an "Indemnifying Party") is or may be required to pay to any other Person (an "Indemnified PartyIndemnitee") pursuant to the indemnification provisions contained in respect of Damages Section 3.05, Section 4.01 or other Liability for which indemnification is provided under this Agreement Section 4.02 shall be reduced (including, without limitation, retroactively) by any Insurance Proceeds or other amounts actually received (including Insurance Proceeds actually received) recovered by or on behalf of such Indemnified Party (net Indemnitee, in reduction of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred Loss. If an Indemnitee shall have received the payment required by such Indemnified Section 3.05, 4.01 or 4.02 of this Agreement from an Indemnifying Party in connection with seeking to collect respect of any Loss and collecting such amounts) shall subsequently actually receive Insurance Proceeds or other amounts in respect of such Damages or other Liability (Loss, then such net amounts are referred Indemnitee shall pay to herein as "Indemnity Reduction Amounts"). If any Indemnified such Indemnifying Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after a sum equal to the full amount of such Damages has been paid Insurance Proceeds or other amounts actually received (subject to the enforcement of the following sentence and up to but not in excess of the amount of any indemnity payment made hereunder). An insurer who would otherwise be obligated to pay any claim shall not be relieved of the responsibility with respect thereto, or, solely by virtue of the indemnification provisions hereof, have any subrogation rights with respect thereto, it being expressly understood and agreed that no insurer or any other third party shall be entitled to a "windfall" (i.e., a benefit they would not be entitled to receive in the absence of the indemnification provisions) by virtue of the indemnification provisions hereof.
(b) If an Indemnitee shall actually realize a tax saving by reason of having incurred a Loss for which such Indemnitee shall have received a payment from an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such DamagesParty, then the Indemnified Party such Indemnitee shall promptly remit pay to the such Indemnifying Party an amount equal to such tax saving. Whenever there is a substantial likelihood that an Indemnitee will receive a tax saving by reason of a Loss, such Indemnitee shall file its tax returns in a manner designed to do so, provided that such Indemnitee shall have the excess sole responsibility for the preparation of its tax returns and reporting thereon such Loss and any payments received from such Indemnifying Party. An Indemnitee shall be deemed actually to have realized a tax saving with respect to a Loss if, and to the extent that, for any taxable period, whether ending before, on or after the Distribution Date, the aggregate federal, state, local and foreign tax liability actually payable by such Indemnitee and any of its wholly-owned subsidiaries, computed by taking into account any deductions, credits or other items attributable to a Loss (if anyincluding the receipt of an Indemnity Payment with respect thereto and the payment of any amounts pursuant to this Section 4.03(b)), is less than such aggregate tax liability, computed without regard to such deductions, credits or other items attributable to a Loss (including the receipt of an indemnity payment with respect thereto and the payment of any amounts pursuant to this Section 4.03(b)). In the event that, following a payment by an Indemnitee pursuant to this Section 4.03(b) in respect of (A) a tax saving, there shall be an adjustment to the amount theretofore paid by the Indemnifying Party of such tax saving as a result of an audit or other proceeding in respect of such Damages, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the amount of any indemnity payment under this Agreement, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax costIndemnitee's tax returns, the Indemnified Party and its Affiliates parties shall take appropriate actions to reflect such adjustment. The term "tax saving" shall also be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as include any interest received from a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax governmental tax authority, except to the extent that a final determination (as defined in Section 1313 net of the Code) with respect to the recipient party causes any such payment not to be so treatedfederal, state, local or foreign taxes payable thereon.
(c) No monetary In the event that an indemnity payment shall be denominated in a currency other than United States dollars, the amount will of such payment shall be payable by Seller to any Purchaser Indemnified Party translated into United States dollars using the Foreign Exchange Rate for such currency determined in accordance with the following rules:
(1) with respect to a Loss arising from payment by a financial institution under a guarantee, comfort letter, letter of credit, foreign exchange contract or similar instrument, the indemnification Foreign Exchange Rate for such currency shall be determined as of any claims pursuant the date on which such financial institution shall have been reimbursed;
(2) with respect to Section 8.1(i) until a Loss covered by insurance, the aggregate amount of Damages actually incurred Foreign Exchange Rate for such currency shall be the Foreign Exchange Rate employed by the Purchaser Indemnified Parties insurance company providing such insurance in settling such Loss with the Indemnifying Party; and
(3) with respect to a Loss not covered by clause (1) or (2) of this Section 4.03(c), the Foreign Exchange Rate for such currency shall be determined as of the date that notice of the claim with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller Loss shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect given to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)Indemnitee.
(d) No monetary If the amount will be payable by Purchaser to of any Seller Indemnified Party with respect Loss shall, at any time subsequent to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred payment required by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000)this Agreement, in which event Purchaser shall be responsible only for reduced by recovery, settlement or otherwise, the amount of such Damages reduction, less any expenses incurred in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will connection therewith, shall promptly be payable repaid by Purchaser to any Seller Indemnified Party with respect the Indemnitee to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)Indemnifying Party.
Appears in 2 contracts
Samples: Distribution Agreement (Hussmann International Inc), Distribution Agreement (Midas Inc)
Limitations on Indemnification Obligations. (a) Reductions for Insurance Proceeds and Other Recoveries. The amount which that ------------------------------------------------------ any Party party (an "Indemnifying Party") is or may be required to pay to any other Person (an "Indemnified PartyIndemnitee") in respect of Damages pursuant to Section 7.03, 7.04 or other Liability for which indemnification is provided under this Agreement 7.05, as applicable, shall be reduced (retroactively or prospectively) by any Insurance Proceeds or other amounts actually received (including Insurance Proceeds actually received) recovered from third parties by or on behalf of such Indemnified Party (net of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) Indemnitee in respect of such Damages the related Indemnifiable Loss. The existence of a claim by an Indemnitee for monies from an insurer or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts against a third party in respect of Damages for which any Indemnifiable Loss shall not, however, delay any payment pursuant to the indemnification is provided under this Agreement after the full amount of such Damages has been paid provisions contained herein and otherwise determined to be due and owing by an Indemnifying Party or after an Party. Rather the Indemnifying Party has made a partial shall make payment in full of such Damages the amount determined to be due and such Indemnity Reduction Amounts exceed owing by it against an assignment by the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit Indemnitee to the Indemnifying Party of the entire claim of the Indemnitee for Insurance Proceeds or against such third party. Notwithstanding any other provisions of this Agreement, it is the intention of the parties that no insurer or any other third party shall be (i) entitled to a benefit it would not be entitled to receive in the absence of the foregoing indemnification provisions, or (ii) relieved of the responsibility to pay any claims for which it is obligated. If an amount equal to Indemnitee has received the excess (if any) of (A) the amount theretofore paid payment required by the this Agreement from an Indemnifying Party in respect of any Indemnifiable Loss and later receives Insurance Proceeds or other amounts in respect of such DamagesIndemnifiable Loss, less then such Indemnitee shall hold such Insurance Proceeds or other amounts in trust for the benefit of the Indemnifying Party (Bor Indemnifying Parties) and shall pay to the Indemnifying Party, as promptly as practicable after receipt, a sum equal to the amount of such Insurance Proceeds or other amounts received, up to the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the aggregate amount of any indemnity payment under this Agreement, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates arising payments received from the incurrence or payment by the Indemnified Indemnifying Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess Indemnifiable Loss (or, if there is more than one Indemnifying Party, the Indemnitee shall pay each Indemnifying Party, its proportionate share (based on payments received from the Indemnifying Parties) of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000Insurance Proceeds).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 2 contracts
Samples: Distribution Agreement (Varian Associates Inc /De/), Distribution Agreement (Varian Inc)
Limitations on Indemnification Obligations. (a) The amount which any Party party (an "Indemnifying PartyINDEMNIFYING PARTY") is or may be required to pay to any other Person (an "Indemnified PartyINDEMNITEE") pursuant to the indemnification provisions contained in respect of Damages SECTION 3.05, SECTION 4.01 or other Liability for which indemnification is provided under this Agreement SECTION 4.02 shall be reduced (including, without limitation, retroactively) by any Insurance Proceeds or other amounts actually received (including Insurance Proceeds actually received) recovered by or on behalf of such Indemnified Party (net Indemnitee, in reduction of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred Loss. If an Indemnitee shall have received the payment required by such Indemnified SECTION 3.05, 4.01 or 4.02 of this Agreement from an Indemnifying Party in connection with seeking to collect respect of any Loss and collecting such amounts) shall subsequently actually receive Insurance Proceeds or other amounts in respect of such Damages or other Liability (Loss, then such net amounts are referred Indemnitee shall pay to herein as "Indemnity Reduction Amounts"). If any Indemnified such Indemnifying Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after a sum equal to the full amount of such Damages has been paid Insurance Proceeds or other amounts actually received (subject to the enforcement of the following sentence and up to but not in excess of the amount of any indemnity payment made hereunder). An insurer who would otherwise be obligated to pay any claim shall not be relieved of the responsibility with respect thereto, or, solely by virtue of the indemnification provisions hereof, have any subrogation rights with respect thereto, it being expressly understood and agreed that no insurer or any other third party shall be entitled to a "windfall" (I.E., a benefit they would not be entitled to receive in the absence of the indemnification provisions) by virtue of the indemnification provisions hereof.
(b) If an Indemnitee shall actually realize a tax saving by reason of having incurred a Loss for which such Indemnitee shall have received a payment from an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such DamagesParty, then the Indemnified Party such Indemnitee shall promptly remit pay to the such Indemnifying Party an amount equal to such tax saving. Whenever there is a substantial likelihood that an Indemnitee will receive a tax saving by reason of a Loss, such Indemnitee shall file its tax returns in a manner designed to do so, provided that such Indemnitee shall have the excess sole responsibility for the preparation of its tax returns and reporting thereon such Loss and any payments received from such Indemnifying Party. An Indemnitee shall be deemed actually to have realized a tax saving with respect to a Loss if, and to the extent that, for any taxable period, whether ending before, on or after the Distribution Date, the aggregate federal, state, local and foreign tax liability actually payable by such Indemnitee and any of its wholly-owned subsidiaries, computed by taking into account any deductions, credits or other items attributable to a Loss (if anyincluding the receipt of an Indemnity Payment with respect thereto and the payment of any amounts pursuant to this SECTION 4.03(b)), is less than such aggregate tax liability, computed without regard to such deductions, credits or other items attributable to a Loss (including the receipt of an indemnity payment with respect thereto and the payment of any amounts pursuant to this SECTION 4.03(b)). In the event that, following a payment by an Indemnitee pursuant to this SECTION 4.03(b) in respect of (A) a tax saving, there shall be an adjustment to the amount theretofore paid by the Indemnifying Party of such tax saving as a result of an audit or other proceeding in respect of such Damages, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the amount of any indemnity payment under this Agreement, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax costIndemnitee's tax returns, the Indemnified Party and its Affiliates parties shall take appropriate actions to reflect such adjustment. The term "TAX SAVING" shall also be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as include any interest received from a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax governmental tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification net of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000)federal, in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be state, local or foreign taxes payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)thereon.
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 2 contracts
Samples: Distribution Agreement (Hussmann International Inc), Distribution Agreement (Midas Group Inc)
Limitations on Indemnification Obligations. (a) The Parties intend that any Liability subject to indemnification, contribution or reimbursement pursuant to this Article IV or Article V will be net of Insurance Proceeds or other amounts actually recovered (net of any out-of-pocket costs or expenses incurred in the collection thereof) from any Person by or on behalf of the Indemnitee in respect of any indemnifiable Liability. Accordingly, the amount which any either Party (an "“Indemnifying Party"”) is or may be required to pay to any Person entitled to indemnification or contribution hereunder (an "Indemnified Party"“Indemnitee”) in respect of Damages or other Liability for which indemnification is provided under this Agreement shall will be reduced by any Insurance Proceeds or other amounts actually received recovered (including Insurance Proceeds actually receivednet of any out-of-pocket costs or expenses incurred in the collection thereof) from any Person by or on behalf of such Indemnified Party (net of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) Indemnitee in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts")the related Liability. If any Indemnified an Indemnitee receives a payment (an “Indemnity Payment”) required by this Agreement from an Indemnifying Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after any Liability and subsequently receives Insurance Proceeds or any other amounts in respect of the full amount of such Damages has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such Damagesrelated Liability, then the Indemnified Party shall promptly remit Indemnitee will pay to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such Damages, less (B) Indemnity Payment received over the amount of the indemnity payment Indemnity Payment that would have been due if the Insurance Proceeds or such Indemnity Reduction Amounts other amounts (net of any out-of-pocket costs or expenses incurred in respect thereof the collection thereof) had been received received, realized or recovered before the indemnity payment Indemnity Payment was made.
(b) In determining The Parties agree that an insurer that would otherwise be obligated to pay any claim shall not be relieved of the amount responsibility with respect thereto or, solely by virtue of any indemnity provision contained in this Agreement or any Ancillary Agreement, have any subrogation rights with respect thereto, it being understood that no insurer or any other Third Party shall be entitled to a “windfall” (i.e., a benefit they would not be entitled to receive in the absence of the indemnification provisions) by virtue of the indemnification and contribution provisions hereof. Each Party shall, and shall cause the members of its Group to, use commercially reasonable efforts (taking into account the probability of success on the merits and the cost of expending such efforts, including attorneys’ fees and expenses) to collect or recover any Insurance Proceeds that may be collectible or recoverable respecting the Liabilities for which indemnification or contribution may be available under this Article IV. Notwithstanding the foregoing, an Indemnifying Party may not delay making any indemnification payment required under the terms of this Agreement, such amount shall be (i) reduced to take into account or otherwise satisfying any net Tax benefit realized by indemnification obligation, pending the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates outcome of any amount in respect of which such payment is made Action to collect or recover Insurance Proceeds, and (ii) increased an Indemnitee need not attempt to take into account collect any net Tax cost incurred by the Indemnified Party and its Affiliates as Insurance Proceeds prior to making a result of the receipt claim for indemnification or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction contribution or credit before recognizing receiving any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed Indemnity Payment otherwise owed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to it under this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take or any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treatedAncillary Agreement.
(c) No monetary amount will The Parties agree that no Indemnitee shall be payable by Seller entitled to indemnification, contribution or reimbursement pursuant to this Article IV for any Purchaser Indemnified Party with respect (i) special, punitive or exemplary damages, (ii) any loss of enterprise value, diminution in value of any business, damage to reputation or loss of goodwill, (iii) any lost profits, consequential, indirect or incidental damages, or (iv) any damages calculated based on a multiple of profits, revenue or any other financial metric, except, in each case, to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to extent such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages damages are finally awarded and actually paid by Seller the Indemnitee to a Third Party in connection with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)Third-Party Claim.
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 2 contracts
Samples: Separation and Distribution Agreement (Realty Income Corp), Separation and Distribution Agreement (Orion Office REIT Inc.)
Limitations on Indemnification Obligations. (a) The amount which any Party ------------------------------------------ party (an "Indemnifying Party") is or may be required to pay to any Person MMI Indemnitee or Stream International Indemnitee (an "Indemnified PartyIndemnitee") in respect of Damages pursuant to Sections 5.1 or other Liability for which indemnification is provided under this Agreement 5.2 hereof shall be reduced (including, without limitation, retroactively) by any insurance proceeds or other amounts actually received (including Insurance Proceeds actually received) recovered by or on behalf of such Indemnified Indemnitee in reduction of the related Indemnifiable Loss. To the extent an Indemnifying Party makes full payment in respect of an Indemnifiable Loss and such Indemnifiable Loss is covered by an insurance policy which has not been the subject of an effective assignment to the Indemnifying Party, at the request of the Indemnifying Party, the Indemnitee shall use commercially reasonable efforts at the expense of the Indemnifying Party (net of increased which expenses shall be deemed to include any increase in insurance premiums and charges of the Indemnitee attributable to the extent related filing of such claims) to Damages enforce any and costs and expenses (including reasonable legal fees and expenses) incurred by all claims under such Indemnified Party in connection with seeking to collect and collecting such amounts) insurance policy in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts")Indemnifiable Loss for the benefit of the Indemnifying Party. If any Indemnified Indemnitee shall have received the full payment required by this Agreement from an Indemnifying Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after an Indemnifiable Loss and shall subsequently actually receive insurance proceeds or other amounts in respect of such Indemnifiable Loss, then such Indemnitee shall pay to such Indemnifying Party a sum equal to the full amount of such Damages has been paid by an Indemnifying Party insurance proceeds or after an Indemnifying Party has made a partial payment other amounts actually received (net of such Damages and such Indemnity Reduction Amounts any expenses in obtaining the same), but not to exceed the remaining unpaid balance net amount of such Damages, then the Indemnified Party shall promptly remit to payments previously received by the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by Indemnitee from the Indemnifying Party in respect of such Damages, less (B) the amount Indemnifiable Loss. An insurer who would otherwise be obligated to pay any claim shall not be relieved of the indemnity payment responsibility with respect thereto or, solely by virtue of the indemnification provisions hereof, have any subrogation rights with respect thereto, it being expressly understood and agreed that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the amount of no insurer or any indemnity payment under this Agreement, such amount other third party shall be entitled to a "windfall" (i) reduced i.e., a benefit they would not be entitled to take into account any net Tax benefit realized by receive in the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result absence of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined indemnification provisions) by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention virtue of the Parties indemnification provisions hereof. Nothing herein shall require an Indemnitee to this Agreement that payments made pursuant enforce claims under an insurance policy before proceeding to this Agreement are enforce its rights to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treatedindemnification against an Indemnifying Party.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 2 contracts
Samples: Contribution Agreement (Modus Media International Holdings Inc), Contribution Agreement (Stream International Holdings Inc)
Limitations on Indemnification Obligations. (a) The amount which that any Party party (an "Indemnifying Party") is or may be required to pay to any Person (an "Indemnified Party") Indemnitee in respect of Damages Indemnifiable Losses or other Liability for which indemnification is provided under this Agreement shall be reduced by any amounts actually received (including including, without limitation, Insurance Proceeds actually received) by or on behalf of such Indemnified Party Indemnitee (net of increased insurance premiums and charges related directly and solely to the extent related to Damages Indemnifiable Losses and costs and expenses (including including, without limitation, reasonable legal fees and expenses) incurred by such Indemnified Party Indemnitee in connection with seeking to collect and collecting such amounts) in respect of such Damages Indemnifiable Losses or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party Indemnitee receives any Indemnity Reduction Amounts in respect of Damages an Indemnifiable Loss for which indemnification is provided under this Agreement after the full amount of such Damages Indemnifiable Loss has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages Indemnifiable Loss and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such DamagesIndemnifiable Loss, then the Indemnified Party Indemnitee shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such DamagesIndemnifiable Loss, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made. An insurer or other third party who would otherwise be obligated to pay any claim shall not be relieved of the responsibility with respect thereto or, solely by virtue of the indemnification provisions hereof, have any subrogation rights with respect thereto, it being expressly understood and agreed that no insurer or any other third party shall be entitled to any benefit they would not be entitled to receive in the absence of the indemnification provisions by virtue of the indemnification provisions hereof.
(b) In determining the amount of any indemnity payment under this AgreementIndemnifiable Losses, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates Indemnitee arising from the incurrence or payment by the Indemnified Party or its Affiliates Indemnitee of any amount in respect of which such payment is made Indemnifiable Losses and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates Indemnitee as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates Indemnitee as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treatedIndemnifiable Losses.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 2 contracts
Samples: Distribution Agreement (Huttig Building Products Inc), Distribution Agreement (Huttig Building Products Inc)
Limitations on Indemnification Obligations. (a) The amount which any Party party (an "Indemnifying Party") is or may be required to pay to any Person (an "Indemnified Party") Indemnitee in respect of Damages Indemnifiable Losses or other Liability for which indemnification is provided under this Agreement shall be reduced by any amounts actually received (including Insurance Proceeds actually received) by or on behalf of such Indemnified Party Indemnitee (net of increased insurance premiums and charges related directly and solely to the extent related to Damages Indemnifiable Losses and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party Indemnitee in connection with seeking to collect and collecting such amounts) in respect of such Damages Indemnifiable Losses or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party Indemnitee receives any Indemnity Reduction Amounts in respect of Damages an Indemnifiable Loss for which indemnification is provided under this Agreement after the full amount of such Damages Indemnifiable Loss has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages Indemnifiable Loss and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such DamagesIndemnifiable Loss, then the Indemnified Party Indemnitee shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such DamagesIndemnifiable Loss, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made. An insurer or other third party who would otherwise be obligated to pay any claim shall not be relieved of the responsibility with respect thereto or, solely by virtue of the indemnification provisions hereof, have any subrogation rights with respect thereto, it being expressly understood and agreed that no insurer or any other third party shall be entitled to any benefit they would not be entitled to receive in the absence of the indemnification provisions by virtue of the indemnification provisions hereof.
(b) In determining the amount of any indemnity payment under this AgreementIndemnifiable Losses, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates Indemnitee arising from the incurrence or payment by the Indemnified Party or its Affiliates Indemnitee of any amount in respect of which such payment is made Indemnifiable Losses and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates Indemnitee as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates Indemnitee as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effectIndemnifiable Losses. It is the intention of the Parties to this Agreement parties that indemnity payments made pursuant to this Agreement are to be treated as relating back to the Closing Date Distribution as a purchase price adjustmentan adjustment to capital (i.e., capital contribution or distribution), and the Parties parties shall not take any position inconsistent with such intention before any Tax authorityAuthority (as defined in the Tax Allocation Agreement), except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 2 contracts
Samples: Distribution Agreement (Mindspeed Technologies Inc), Distribution Agreement (Mindspeed Technologies Inc)
Limitations on Indemnification Obligations. (a) The amount which any Party (an "Indemnifying Party") is or may be required to pay to any Person (an "Indemnified Party") in respect of Damages or other Liability for which indemnification is provided under this Agreement shall be reduced by any amounts actually received (including Insurance Proceeds actually received) by or on behalf of such Indemnified Party (net of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after the full amount of such Damages has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such Damages, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the amount of any indemnity payment under this Agreement, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i9.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims, together with the aggregate amount of Damages (as defined in the Mexican Asset Purchase Agreement solely for purposes of this Agreement) actually incurred by the Purchaser Indemnified Parties (as defined in the Mexican Asset Purchase Agreement) with respect to indemnification claims pursuant to Section 9.1(i) of the Mexican Asset Purchase Agreement, shall exceed on a cumulative basis an amount equal to fifty thousand one million dollars (U.S.$50,000U.S.$1,000,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand one million dollars (U.S.$50,000U.S.$1,000,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i9.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims, together with the aggregate amount of Damages (as defined in the Mexican Asset Purchase Agreement) actually paid by Seller with respect to indemnification claims pursuant to Section 9.1(i) of the Mexican Asset Purchase Agreement, shall equal on a cumulative basis an amount equal to five hundred thousand ten million dollars (U.S.$500,000U.S.$10,000,000).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).to
Appears in 2 contracts
Samples: Mexican Asset Purchase Agreement (Conexant Systems Inc), Mexican Asset Purchase Agreement (Skyworks Solutions Inc)
Limitations on Indemnification Obligations. (a) The amount which any Party party (an "Indemnifying Party") is or may be required to pay to any Person other party (an "Indemnified PartyIndemnitee") in respect of Damages pursuant to Section 4.01 or other Liability for which indemnification is provided under this Agreement Section 4.02 shall be reduced (including, without limitation, retroactively) by any proceeds of Policies and amounts recovered under the DKI Indemnification or other amounts actually received (including Insurance Proceeds actually received) recovered by or on behalf of such Indemnified Party Indemnitee, in reduction of the related Loss. If an Indemnitee shall have received the payment (net of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expensesan "Indemnity Payment") incurred required by such Indemnified this Agreement from an Indemnifying Party in connection with seeking to collect respect of any Loss and collecting such amounts) shall subsequently actually receive proceeds of Policies or amounts recovered under the DKI Indemnification or other amounts in respect of such Damages or other Liability Loss, then such Indemnitee shall pay to such Indemnifying Party a sum equal to the amount actually received (such net amounts are referred up to herein as "but not in excess of the amount of any Indemnity Reduction Amounts"Payment made hereunder). An insurer who would otherwise be obligated to pay any claim shall not be relieved of the responsibility with respect thereto, or, solely by virtue of the indemnification provisions hereof, have any subrogation rights with respect thereto, it being expressly understood and agreed that no insurer or any other third party shall be entitled to a "windfall" (i.e., a benefit they would not be entitled to receive in the absence of the indemnification provisions) by virtue of the indemnification provisions hereof.
(b) If any Indemnified Party receives any Indemnity Reduction Amounts Indemnitee realizes a Tax benefit or detriment in respect one or more Tax periods by reason of Damages having incurred an Indemnifiable Loss for which indemnification is provided under this Agreement after the full amount of such Damages has been paid by Indemnitee receives an Indemnity Payment from an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such DamagesParty, then the Indemnified Party such Indemnitee shall promptly remit pay to the such Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Tax benefit or such Indemnifying Party in respect shall pay to such Indemnitee an additional amount equal to the Tax detriment (taking into account any Tax detriment resulting from the receipt of such Damagesadditional amounts), less as the case may be. The amount of any Tax benefit or any Tax detriment for a Tax period realized by an Indemnitee by reason of having incurred an Indemnifiable Loss shall be deemed to equal the product obtained by multiplying (Bi) the amount of any deduction or inclusion in income for such period resulting from such Indemnifiable Loss or the indemnity payment thereof, as the case may be, by (ii) the highest applicable marginal Tax rate for such period (provided, however, that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining -------- the amount of any indemnity payment under this Agreement, such Tax benefit attributable to an amount that is creditable shall be (i) reduced deemed to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining equal the amount of any such creditable item). Any payment due under this Section 4.03(b) with respect to a Tax benefit or Tax cost, the Indemnified Party and its Affiliates detriment realized by an Indemnitee in a Tax period shall be deemed to be subject due and payable within 30 days from the time the return for such Tax period is due, without taking into account any extension of time granted to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with party filing such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treatedreturn.
(c) No monetary In the event that an Indemnity Payment shall be denominated in a currency other than United States dollars, the amount will of such payment shall be payable by Seller to any Purchaser Indemnified Party translated into United States dollars using the Foreign Exchange Rate for such currency determined in accordance with the following rules: 15
(i) with respect to a Loss arising from payment by a financial institution under a guarantee, comfort letter, letter of credit, foreign exchange contract or similar instrument, the indemnification Foreign Exchange Rate for such currency shall be determined as of any claims pursuant the date on which such financial institution shall have been reimbursed; (ii) with respect to Section 8.1(i) until a Loss covered by insurance, the aggregate amount of Damages actually incurred Foreign Exchange Rate for such currency shall be the Foreign Exchange Rate employed by the Purchaser Indemnified Parties insurance company providing such insurance in settling such Loss with the Indemnifying Party; and (iii) with respect to a Loss not covered by clause (i) or (ii) above, the Foreign Exchange Rate for such currency shall be determined as of the date that notice of the claim with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller Loss shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect given to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)Indemnitee.
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 2 contracts
Samples: Distribution Agreement (Premark International Inc), Distribution Agreement (Tupperware Corp)
Limitations on Indemnification Obligations. (a) The amount which any Party (an "Indemnifying Party") is or may be required to pay to any Person (an "Indemnified Party") in respect of Damages or other Liability for which indemnification is provided under this Agreement shall be reduced by any amounts actually received (including Insurance Proceeds actually received) by or on behalf of such Indemnified Party (net of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after the full amount of such Damages has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such Damages, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the amount of any indemnity payment under this Agreement, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i9.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand one million dollars (U.S.$50,000U.S.$1,000,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand one million dollars (U.S.$50,000U.S.$1,000,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i9.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand ten million dollars (U.S.$500,000U.S.$10,000,000).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i9.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand one million dollars (U.S.$50,000U.S.$1,000,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand one million dollars (U.S.$50,000U.S.$1,000,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i9.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand ten million dollars (U.S.$500,000U.S.$10,000,000).
Appears in 2 contracts
Samples: Mexican Stock and Asset Purchase Agreement (Conexant Systems Inc), Mexican Stock and Asset Purchase Agreement (Alpha Industries Inc)
Limitations on Indemnification Obligations. (a) The amount which Seller shall not be obligated to indemnify Purchaser for any Party (an "Indemnifying Party") is or may be required to pay to any Person (an "Indemnified Party") in respect of Damages Losses incurred by Purchaser or other Liability Indemnified Parties of the Purchaser under Section 7.2 until the Losses for which Purchaser is entitled to indemnification is provided under this Agreement exceed $100,000 in the aggregate, in which case, upon exceeding such threshold amount, Purchaser shall be reduced entitled to recover all such Losses (including such initial threshold amount). Except as expressly provided in the next sentence of this Section 7.6(a), notwithstanding anything contained in this Agreement to the contrary, in no event shall Seller’s liability for Losses under this Section 7.2(a) exceed, in the aggregate, $1,500,000, in no event shall Seller’s liability for Losses under Section 7.2(b) exceed, in the aggregate, the Purchase Price; and in no event shall Purchaser’s liability for Losses under Section 7.2(c) exceed, in the aggregate, the Purchase Price. The provisions of this Section 7.6(a) shall not apply to Seller’s indemnification obligations under this Agreement arising out of, relating to or resulting from fraud by such party.
(b) Notwithstanding anything contained in this Agreement to the contrary, the amount of an Indemnifying Party’s liability pursuant to this Section 7 shall be net of any insurance proceeds or other third party indemnity or contribution amounts actually received (including Insurance Proceeds actually received) recovered by or on behalf of such an Indemnified Party. Each Indemnified Party (net of increased shall use commercially reasonable efforts to collect any such insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred proceeds or other third party indemnity or contribution amounts recoverable by such Indemnified Party Party, and in connection with seeking to collect and collecting the event any such amounts) in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages collected after a claim for which indemnification is provided under this Agreement after the full amount of such Damages Losses has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such DamagesParty, then the Indemnified Party shall promptly remit reimburse such amounts to the such Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such Damages, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the amount of any indemnity payment under this Agreement, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treatedParty.
(c) No monetary amount will Notwithstanding anything to the contrary contained in this Agreement, no Indemnifying Party shall be payable by Seller liable to any Purchaser an Indemnified Party with for any indirect, special, punitive, exemplary or consequential loss or damage (including any loss of opportunity or loss of value, revenue or profit) arising out of this Agreement; provided, however, that the foregoing shall not be construed to preclude recovery by an Indemnified Party in respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount such Losses directly incurred as a result of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Third Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)Claim.
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 2 contracts
Samples: Purchase and Sale Agreement (Cypress Semiconductor Corp /De/), Purchase and Sale Agreement (Netlogic Microsystems Inc)
Limitations on Indemnification Obligations. (a) The amount which any Party (an "Indemnifying Party") is Notwithstanding the provisions of this Xxxxxxx 0, xxxx of the parties shall be obligated to indemnify or may be required to pay damages to any Person (an "Indemnified Party") in respect of Damages other party or other Liability for which indemnification is provided under parties, as the case may be, from and against any Losses arising from or related to this Agreement shall be reduced by any amounts actually received (including Insurance Proceeds actually received) by or on behalf of such Indemnified Party (net of increased insurance premiums and charges to the extent that such Losses arise from or related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after the full amount of such Damages has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such Damages, less (B) the amount [***] of the indemnity payment Purchase Price; provided, however, that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the amount of any indemnity payment under this Agreement, such amount shall be (i) reduced any claims brought by a party against another party or parties for fraud or willful misconduct shall not be subject to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made foregoing limitations; and (ii) increased the Contacts Parties’ indemnification obligations pursuant to take into account any net Tax cost incurred this Section 8 shall exist only to the extent that, at the time of an indemnification Claim by Mi Gwang, the Contacts Parties own Mi Gwang Shares which have a market value equal to or in excess of [***]. Any indemnification funds to be provided or paid by the Indemnified Party and its Affiliates as a result Contacts Parties pursuant to the provisions of this Section 8 shall come only from the sale or transfer of the receipt Mi Gwang Shares, and the Contacts Parties shall, never, under any circumstances, have any obligation to pay any indemnification Claim by Mi Gwang in excess of the market value of the Mi Gwang Shares owned by the Contacts Parties. Furthermore, notwithstanding the provisions of this Xxxxxxx 0, xxxx of the parties shall be obligated to indemnify or accrual of payments hereunder (grossed-up for such increase)pay damages to any other party or parties, in each as the case determined by treating the Indemnified Party may be, from and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing against any item Losses arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties related to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination such Losses arising from or related to this Agreement do not cumulatively exceed One Hundred Thousand U.S. Dollars (as defined in Section 1313 $100,000); provided, however, that this limitation shall not be applicable to any cost, liability or obligation of the Code) with respect to Contacts Parties expressly assumed by the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims Contacts Parties pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed that certain Reimbursement Agreement in form and content as set forth on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)Exhibit D hereto.
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 1 contract
Limitations on Indemnification Obligations. The rights of the Indemnified Parties to indemnification pursuant to Section 9.2 are subject to the limitations set forth in this Section 9.3 and elsewhere in this Article IX.
(a) The amount which any Party (an "Indemnifying Party") is or may Notwithstanding anything to the contrary contained herein, the Sellers shall not be required to pay to indemnify any Person (an "Indemnified Party") in respect of Damages or other Liability for which indemnification is provided under this Agreement shall be reduced by any amounts actually received (including Insurance Proceeds actually received) by or on behalf of such Buyer Indemnified Party (net of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after the full amount of such Damages has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such Damages, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the amount of any indemnity payment under this Agreement, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustmentto, and the Parties shall not take have any position inconsistent with such intention before any Tax authorityliability under, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i9.2(a)(i) until the aggregate amount of Damages actually incurred by all Losses for which the Purchaser Indemnified Parties with respect to such claims shall exceed Sellers would be liable under Section 9.2(a)(i), but for this Section 9.3(a), exceeds on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000)the Deductible, in which event Seller case, the Buyer Indemnified Parties shall be responsible entitled to indemnification only for the amount of such Damages Losses in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller the Deductible; provided, however, that the Deductible shall not apply to any Purchaser Losses which result from any inaccuracy or breach of any Fundamental Representation or Tax Representation made by Sellers, or any claim based on or arising out of Fraud.
(b) Notwithstanding anything to the contrary contained herein, the Buyers shall not be required to indemnify any Seller Indemnified Party with respect to the indemnification of pursuant to, and shall not have any claims pursuant to liability under, Section 8.1(i9.2(b)(i) after until the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal all Losses for which the Buyers would be liable under Section 9.2(b)(i), but for this Section 9.3(b), exceeds on a cumulative basis an amount equal to five hundred thousand dollars the Deductible, in which case, the Seller Indemnified Parties shall be entitled to indemnification only for the amount of such Losses in excess of the Deductible; provided, however, that the Deductible shall not apply to any Losses which result from any inaccuracy or breach of any Fundamental Representation made by Buyer, any claim based on or arising out of Fraud.
(U.S.$500,000)c) No right to be indemnified or held harmless pursuant to Section 9.2(a)(i) shall exist and no claim may be made following such time, if any, that the aggregate amount paid by the Sellers for indemnification pursuant to Section 9.2(a)(i) (other than with respect to Losses which result from any inaccuracy or breach of any Fundamental Representation or Tax Representation made by Sellers, or any claim based on or arising out of Fraud) (whether from the Indemnity Escrow Account or directly from Sellers) equals $125,000.
(d) No monetary right to be indemnified or held harmless pursuant to Section 9.2(b)(i) shall exist and no claim may be made following such time, if any, that the aggregate amount will be payable paid by Purchaser the Buyers for indemnification pursuant to any Seller Indemnified Party Section 9.2(b)(i) (other than with respect to the indemnification Losses which result from any inaccuracy or breach of any claims Fundamental Representation made by Buyer, or any claim based on or arising out of Fraud) equals $7,500,000.
(e) No right to be indemnified or held harmless pursuant to Section 8.2(i9.2(a) until (other than pursuant to Section 9.2(a)(iii) with respect to clause (iv) of the definition of Pre-Closing Taxes or Losses in respect of Fraud, which claims shall be uncapped) shall exist and no claim may be made following such time, if any, that the aggregate amount paid by Sellers for indemnification pursuant to Section 9.2(a) (other than with respect to Fraud or with respect to any Losses which relate to clause (iv) of Damages actually incurred the definition of Pre-Closing Taxes) (whether from the Indemnity Escrow Account or directly from Sellers) equals the Purchase Price.
(f) No right to be indemnified or held harmless pursuant to Section 9.2(b) shall exist and no claim may be made following such time, if any, that the aggregate amount paid by Buyers for indemnification pursuant to Section 9.2(b) (other than with respect to any claim based on or arising out of Fraud) equals the Purchase Price.
(g) The Indemnified Parties shall diligently pursue recovery for Losses under any available insurance coverage (including, as to the Buyer Indemnified Parties, the R&W Policy) and shall use commercially reasonable efforts to pursue payment from any applicable Person under any agreement, contract, arrangement or commitment pursuant to which any Indemnified Party is entitled to indemnification for any Loss for which an Indemnified Party seeks indemnification pursuant to this ARTICLE IX.
(h) Neither Seller nor Buyers shall (and each shall cause its Affiliates not to) solicit claims from any Persons for the primary purpose of creating claims for indemnification for which any Person would be responsible under this Agreement.
(i) The Parties acknowledge that Buyers are obtaining the R&W Policy. The Parties agree that, if a Buyer Indemnified Party is entitled to indemnification pursuant to Section 9.2(a)(i) or Section 9.2(a)(iii):
(i) The Indemnity Escrow Account held by the Seller Escrow Agent will be the first source of recovery against Sellers for such amounts payable to the Buyer Indemnified Parties, after (if applicable) satisfaction of the Deductible threshold described above, until the earlier to occur of its exhaustion or release.
(ii) The R&W Policy will be the second source of recovery for the Buyer Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal covered thereby; provided, that, for Losses which result from breaches of Fundamental Representations or Tax Representations or pursuant to fifty thousand dollars (U.S.$50,000Section 9.2(a)(iii), to the extent (but only to the extent) that the retention under the R&W Policy has not been exhausted, the Losses are excluded from coverage under the R&W Policy or the policy limit of the R&W Policy has been reached and paid, the Buyer Indemnified Parties may recover directly from Sellers under Section 9.2(a)(i) and Section 9.2(a)(iii), as applicable, subject to the limits in which this ARTICLE IX. NOTWITHSTANDING ANY PROVISION IN THIS AGREEMENT TO THE CONTRARY, BUYER, ON BEHALF OF ITSELF AND THE OTHER BUYER INDEMNIFIED PARTIES, ACKNOWLEDGES AND AGREES THAT THE FOREGOING SHALL CONTINUE TO APPLY EVEN IF (I) THE R&W POLICY IS REVOKED, CANCELLED OR MODIFIED, OR EXPIRES, IN ANY MANNER (AND EVEN IF THE R&W POLICY IS NOT ISSUED); (II) ANY CLAIM MADE AGAINST THE R&W POLICY IS DENIED BY THE INSURER; OR (III) ALL AMOUNTS PERMITTED TO BE RECOVERED AGAINST THE R&W POLICY HAVE BEEN RECOVERED.
(iii) For the avoidance of doubt, nothing contained herein shall in any way limit the Buyer Indemnified Parties’ ability to recover under the R&W Policy.
(j) In no event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Buyer Indemnified Party be entitled to indemnification pursuant to this Article IX with respect to a specific Loss to the indemnification extent such Loss is accounted for in the calculation of the Purchase Price, as finally determined in accordance with Section 2.3 to avoid “double dipping.”
(k) With respect to any claims pursuant indemnifiable Losses arising under Section 9.2(a)(v), such Losses shall be limited to Section 8.2(i) after direct Losses incurred or suffered by the aggregate amount Buyer Indemnified Persons and shall not include Losses based on a multiple of Damages actually paid by Purchaser losses or damages or diminution in value or the costs of investigation (unless, with respect to such claims shall equal on an investigation, an investigation commenced in connection with a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000Claim by a Governmental Entity).
Appears in 1 contract
Samples: Securities Purchase Agreement (Astrana Health, Inc.)
Limitations on Indemnification Obligations. (a) The amount which any Party party (an "“Indemnifying Party"”) is or may be required to pay to any Person other party (an "Indemnified Party"“Indemnitee”) in respect of Damages pursuant to Section 9.1 or other Liability for which indemnification is provided under this Agreement Section 9.2 shall be reduced (including, without limitation, retroactively) by any amounts actually received (including Insurance Proceeds or other amount actually received) recovered by or on behalf of such Indemnified Party (net Indemnitee, in reduction of increased the related Loss arising out of a Company Liability or Bio Companies Liability; provided, that no party is required to maintain insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by for such Indemnified Party in connection with seeking to collect and collecting such amounts) in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts")purpose. If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under an Indemnitee shall have received the payment required by this Agreement after the full amount of such Damages has been paid by from an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of any Loss arising out of a Company Liability or Bio Companies Liability and shall subsequently actually receive Insurance Proceeds or other amounts in respect of such DamagesLoss arising out of a Company Liability or Bio Companies Liability, less (B) then such Indemnitee shall pay to such Indemnifying Party a sum equal to the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts Insurance Proceeds or other amounts actually received (up to but not in respect thereof had been received before the indemnity payment was made.
(b) In determining excess of the amount of any indemnity payment under this Agreementmade hereunder). An insurer who would otherwise be obligated to pay any claim shall not be relieved of the responsibility with respect thereto, such amount or, solely by virtue of the indemnification provisions hereof, have any subrogation rights with respect thereto, it being expressly understood and agreed that no insurer or any other third party shall be entitled to a “windfall” (i) reduced i.e., a benefit they would not be entitled to take into account any net Tax benefit realized by receive in the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result absence of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined indemnification provisions) by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention virtue of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treatedindemnification provisions hereof.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 1 contract
Limitations on Indemnification Obligations. The rights of an Indemnified Party to indemnification pursuant to the provisions of Section 7.2 are subject to the following limitations:
(a) The An Indemnified Party shall not be entitled to recover Damages under Section 7.2 until the cumulative amount of Damages claimed by the Indemnified Parties exceeds $650,000, in which case, such Indemnified Party shall be entitled to indemnification for all Damages in excess of (but not including) such amount. Notwithstanding the foregoing, the limitations contained in this Section 7.3(a) shall not apply to Excluded Damages, as defined below.
(b) Except for injunctive relief and similar equitable remedies and except for Damages relating to or arising out of (i) fraud, willful misrepresentation or willful breach by N-able, (ii) any Party breach of the Surviving Claims, (an "Indemnifying Party"iii) is any payment due SolarWinds under Section 3.2(d) or may Section 6.6, or (iv) claims set forth in Section 7.2(a)(iv), (v), or (vi) above (collectively, the “Excluded Damages”), recourse to the Escrow Fund in accordance with the provisions hereof shall be the Indemnified Parties’ sole and exclusive remedy available for any Damages under Section 7.2 above, subject to the below provisions of this Section 7.3; provided, however, that with respect to Excluded Damages, the Indemnified Parties shall first be required to pay satisfy such Excluded Damages from the Escrow Fund and, if the Escrow Fund is insufficient to any Person (an "Indemnified Party") in respect of satisfy such Excluded Damages or other Liability for which indemnification is provided under this Agreement shall be reduced by any amounts actually received (including Insurance Proceeds actually received) by or on behalf of such Indemnified Party (net of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after the full amount of such Damages has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such Damagesreleased in accordance with Section 7.4, then the Indemnified Party Parties shall promptly remit be entitled to seek recourse from other sources.
(c) The Indemnifying Parties shall not be liable for any Damages to the Indemnifying extent that such Damages have been reserved for on the Closing Balance Sheet and taken into account in calculating the Closing Working Capital Amount or have been otherwise recovered by any Indemnified Party an amount equal or satisfied by any other Person including, without limitation, as a result of any Indemnified Party receiving or being reasonably able to receive compensation for such Damages pursuant to any policy of insurance maintained by any Indemnified Party.
(d) Notwithstanding anything to the excess contrary contained herein, in no event shall: (if anyi) any Indemnifying Party’s aggregate liability with respect to Damages, other than Excluded Damages, arising out of or relating to this Agreement exceed such N-able Equity Holder’s Pro Rata Share of the Escrow Cash; (ii) any Indemnifying Party’s liability with respect to Damages in respect of any indemnification claim hereunder exceed (A) the amount theretofore paid of such Damages indemnified by the all Indemnifying Party Parties in respect of any such Damages, less indemnification claim multiplied by (B) such Indemnifying Party’s Pro Rata Share; (iii) any Indemnifying Party’s aggregate liability with respect to Damages arising out of or relating to this Agreement exceed such Indemnifying Party’s net proceeds received in connection with the amount Merger; or (iv) the Indemnifying Parties’ collective aggregate liability with respect to Damages arising out of or relating to this Agreement exceed the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was madePurchase Price.
(be) In determining Notwithstanding anything to the amount contrary contained herein, N-able shall not have any Liability under any provision of any indemnity payment under this Agreement, such amount shall be Agreement for (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates Damages consisting of any amount diminution in respect of which such payment is made and value, (ii) increased any punitive, incidental, consequential, special or indirect Damages or (iii) any Damages consisting of multiples of EBITDA, discounted cash flow or other multiples used to take into account any net Tax cost incurred by determine the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder Purchase Price hereunder, except, with respect to clauses (grossed-up for such increasei), in each case determined by treating the Indemnified Party (ii) and its Affiliates as recognizing all other items of income(iii), gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent such Damages are payable to a third party pursuant to a Third Party Claim; provided, however, that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount N-able will be payable by Seller to liable for any Purchaser Indemnified Party with respect to the indemnification Damages consisting of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000)lost revenue, in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)profits or earnings, or increased expenses.
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 1 contract
Samples: Merger Agreement (SolarWinds, Inc.)
Limitations on Indemnification Obligations. (a) The amount which any Party party (an "Indemnifying Party") is or may be required to pay to any Person (an "Indemnified Party") Indemnitee in respect of Damages Indemnifiable Losses or other Liability for which indemnification is provided under this Agreement shall be reduced by any amounts actually received (including Insurance Proceeds actually received) by or on behalf of such Indemnified Party Indemnitee (net of increased insurance premiums and charges related directly and solely to the extent related to Damages Indemnifiable Losses and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party Indemnitee in connection with seeking to collect and collecting such amounts) in respect of such Damages Indemnifiable Losses or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party Indemnitee receives any Indemnity Reduction Amounts in respect of Damages an Indemnifiable Loss for which indemnification is provided under this Agreement after the full amount of such Damages Indemnifiable Loss has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages Indemnifiable Loss and such Indemnity Reduction Amounts exceed exceeds the remaining unpaid balance of such DamagesIndemnifiable Loss, then the Indemnified Party Indemnitee shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such DamagesIndemnifiable Loss, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made. An insurer or other third party who would otherwise be obligated to pay any claim shall not be relieved of the responsibility with respect thereto or, solely by virtue of the indemnification provisions hereof, have any subrogation rights with respect thereto, it being expressly understood and agreed that no insurer or any other third party shall be entitled to any benefit they would not be entitled to receive in the absence of the indemnification provisions by virtue of the indemnification provisions hereof.
(b) In determining the amount of any indemnity payment under this AgreementIndemnifiable Losses, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates Indemnitee arising from the incurrence or payment by the Indemnified Party or its Affiliates Indemnitee of any amount in respect of which such payment is made Indemnifiable Losses and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates Indemnitee as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates Indemnitee as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effectIndemnifiable Losses. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).parties to
Appears in 1 contract
Limitations on Indemnification Obligations. (a) The amount which any Indemnified Party (an "shall not be entitled to recover from the Indemnifying Party") is or may be required to pay to any Person (an "Indemnified Party") in respect of Damages or other Liability for which indemnification is provided Party under this Agreement shall be reduced Section 8 unless and until the aggregate amount of all Losses by any amounts actually received (including Insurance Proceeds actually received) by or on behalf of such the Indemnified Party under this Section 8 exceeds $100,000 (net of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction AmountsBasket"). If The parties hereto agree that once the aggregate amount of Losses by any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after exceeds the full amount of such Damages has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such DamagesBasket, then the Indemnified Party shall promptly remit be entitled to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such Damages, less (B) indemnity for the amount of all claims made by the indemnity payment that would have been due if Indemnified Party in excess of the Basket. The Indemnifying Party shall not be obligated to pay any Losses under this Section 8 once the aggregate amount of all Losses paid by such Indemnity Reduction Amounts Indemnifying Party under this Section 8 equals $1,500,000 (the "Cap"). Notwithstanding the foregoing, the Cap shall not apply to (i) any indemnification claims based upon fraud or intentional misrepresentation and the Indemnified Party shall be entitled to recovery for all Losses in respect thereof had been received before connection with claims pursuant to fraud or intentional misrepresentation, (ii) any indemnification claims based upon Section 2.2, (iii) any indemnification claims based upon failure of the indemnity payment was madeCompany to perform or pay the liabilities of the Company after the Effective Date as and when due, and (iv) any indemnification claims based upon Section 8.2(b-g). In the case of 8.7(a)(ii) the Company shall be entitled to recover all Losses resulting therefrom and in either case of 8.7(a)(iii) or 8.7(a)(iv) the Seller shall be entitled to recover for all Losses resulting therefrom.
(b) In determining Subject to the provisions of this Section 8, an Indemnified Party shall be entitled to recover the full amount of any indemnity payment under this AgreementLosses incurred due to the matter for which indemnification is sought, such amount but any recovery shall be net of any economic benefit to which the Indemnified Party is entitled due to such Losses, including, without limitation, (i) reduced to take into account any net Tax tax refund, reduction or benefit realized by the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the insurance proceeds (excluding self-insured amounts and deductible amounts). In no event shall any Indemnified Party and its Affiliates as a result of the receipt be awarded punitive or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treatedmultiple damages.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 1 contract
Limitations on Indemnification Obligations. Notwithstanding any contrary term in this Article VIII:
(a) The amount which any Party (an "Indemnifying Party") is or may Under no circumstances shall the Seller be required to pay provide indemnification to any Person (an "Indemnified Party"the Buyer Indemnitees under Section 8.01(a) in an aggregate amount exceeding $10,000,000, provided that this Section 8.04(a) shall not apply with respect to indemnification claims under Section 8.01(a)(i) with respect to breach of Damages the warranties and representations set forth in Section 3.26.
(b) The indemnified party shall use commercially reasonable efforts to assert all claims under all applicable insurance policies, indemnity, contribution or other Liability for which similar agreements and any indemnification is provided claim asserted under this Agreement shall be reduced net of any of insurance, indemnity, contribution, warranty, set-off or similar proceeds received by any amounts actually received (including Insurance Proceeds actually received) by or on behalf of such Indemnified Party the indemnified party (net of increased any deductible amounts and costs of collection, or increase in insurance premiums and charges due to the circumstances underlying the claim), and, to the extent related that such proceeds are collected by the indemnified party after an indemnification claim has been settled or finally determined, the indemnified party will restore the indemnifying party to Damages and costs and expenses the same economic position as would have existed had such proceeds been collected prior to the settlement or final determination of such claim.
(including reasonable legal fees and expensesc) incurred by Upon making any indemnification payment, the indemnifying party will, to the extent of such Indemnified Party in connection with seeking payment, be subrogated to collect and collecting such amounts) all rights of the indemnified party against any third party in respect of the Loss to which the payment relates, and each such Damages or other Liability (such net amounts are referred indemnified party and indemnifying party will duly execute upon request all instruments reasonably necessary to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after evidence and perfect the full amount of such Damages has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such Damages, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was madeabove-described subrogation rights.
(bd) In determining the amount The amounts for which an indemnifying party shall be liable shall be net of any indemnity payment under this Agreement, such amount shall be (i) reduced to take into account any net Tax benefit actually realized by the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates indemnified party as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party facts and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject circumstances giving rise to the applicable Taxes at the maximum statutory rate then in effect. It is the intention liability of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustmentindemnifying party, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination such Tax benefits are recognized in the same taxable year (as defined or the following year) in Section 1313 of which the Code) with respect to the recipient party causes any such payment not to be so treatedliability is incurred.
(ce) No monetary amount will The indemnified party shall not be payable by Seller entitled to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only hereunder for the amount of such Damages Losses in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages Losses which would have been incurred but for any change in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) Law or accounting policies, or interpretations thereof, occurring after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)Closing.
Appears in 1 contract
Samples: Stock Purchase Agreement
Limitations on Indemnification Obligations. (ai) The amount which that any Party party (an "Indemnifying Party") is or may be required to pay to any Person other person (an "Indemnified PartyIndemnitee") in respect pursuant to paragraphs (a), (b) or (c) of Damages or other Liability for which indemnification is provided under this Agreement Section 15, as applicable, shall be reduced (retroactively or prospectively) by any Insurance Proceeds or other amounts actually received (including Insurance Proceeds actually received) recovered by or on behalf of such Indemnified Party (net of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) Indemnitee in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts")the related Indemnifiable Loss. If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under an Indemnitee shall have received the payment required by this Agreement after the full amount of such Damages has been paid by 26 26 from an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of an Indemnifiable Loss and shall subsequently actually receive Insurance Proceeds or other amounts in respect of such DamagesIndemnifiable Loss, less (B) then such Indemnitee shall pay to such Indemnifying Party a sum equal to the amount of such Insurance Proceeds or other amounts actually received, up to the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the aggregate amount of any indemnity payment under this Agreement, payments received from such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Indemnifying Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties in respect of such Indemnifiable Loss.
(ii) An Indemnifying Party shall not take be required to indemnify or pay an Indemnitee pursuant to paragraphs (a), (b) or (c) of this Section 15, as applicable, for any position inconsistent Indemnifiable Losses relating to or associated with such intention before any Tax authorityemployee benefit plan, except to the extent that a final determination (as defined in Section 1313 policy, program or arrangement of the CodeIndemnifying Party arising out of, by reason of or otherwise in connection with any act or failure to act on the part of such Indemnitee (including for this purpose any subsidiaries, businesses or operations which become associated with the Indemnitee by virtue of or in connection with the Distribution) with respect to the recipient party causes or in connection with such employee benefit plan, policy, program or arrangement, including, without limitation, any such payment not act or failure to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party act in connection with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred administration by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount Indemnitee of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)employee benefit plan, policy, program or arrangement.
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 1 contract
Samples: Employee Benefit Services and Liability Agreement (Itt Corp /Nv/)
Limitations on Indemnification Obligations. (a) The amount which any Party (an "Indemnifying Party") is or may Indemnification under this Article 8 shall not be required to pay available to any Person Indemnified Party unless such Indemnified Party first uses commercially reasonable efforts to obtain recovery from any Third Party Source (as defined below) for the applicable claim or Loss before making any claim for indemnification against the Responsible Party. The Responsible Party may, in its sole discretion, require any Indemnified Party to grant an "Indemnified Party") in respect assignment of Damages or other Liability for which indemnification is provided under this Agreement shall be reduced by any amounts actually received (including Insurance Proceeds actually received) by or on behalf the right of such Indemnified Party (net to assert a claim against any Third Party Source. If the amount to be netted hereunder from any payment required under Sections 8.2(a) is determined after payment of increased insurance premiums and charges any amount otherwise required to the extent related be paid to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such an Indemnified Party in connection with seeking to collect and collecting such amounts) in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after the full amount of such Damages has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such DamagesArticle 8, then the Indemnified Party shall promptly remit repay to the Indemnifying Party an Responsible Parties, promptly after such determination, any amount equal that the Responsible Parties would not have had to pay pursuant to this Article 8 had such determination been made at the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect time of such Damages, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was madepayment.
(b) In determining the amount The Buyer Indemnitees shall not have a right to assert claims under any provision of any indemnity payment under this Agreement, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take for any position inconsistent with such intention before any Tax authority, except Losses to the extent that a final determination (as defined in Section 1313 of the Code) with respect such Losses relate to the recipient party causes any such payment not actions taken by or omitted to be so treatedtaken by the Buyer or the Company after the Closing Date.
(c) No monetary The rights of the Buyer Indemnitees to indemnification pursuant to the provisions of Section 8.2(a) are subject to the following limitations:
(i) The amount of any and all Losses will be payable determined net of any (A) accruals or reserves on the Company Financial Statements or the Conclusive Final Closing Statement, (B) amounts recovered by Seller to any Purchaser Indemnified Party the Buyer Indemnitees under indemnification agreements or arrangements with third parties or under insurance policies with respect to such Losses (and no right of subrogation shall accrue to any such third party indemnitor or insurer hereunder) (each such source named in this clause (B) a “Third Party Source”) and (C) an amount equal to any Tax savings or benefits realized or realizable by the Indemnified Party as calculated on a with or without basis. Each Indemnified Party shall use its commercially reasonable efforts to recover all amounts payable from a Third Party Source under any insurance policy or any other Contract prior to seeking indemnification of hereunder.
(ii) The Buyer Indemnitees shall not be entitled to recover for any claims Losses pursuant to Section 8.1(i8.2(a)(i) unless the Loss resulting from such claim or series of related claims equals or exceeds $15,000 (the “Mini-Basket”) ; provided that this limitation shall not apply with respect to (A) breaches of the Fundamental Representations any covenants contained herein or (B) the indemnification obligations set forth in Section 8.6 (collectively, “Special Indemnified Matters”). In addition, the Buyer Indemnitees shall not be entitled to recover any Loss pursuant to Section 8.2(a)(i) in excess of the Mini-Basket unless and until the aggregate amount of Damages actually incurred by all Losses (both before and after the Purchaser Indemnified Parties relevant Mini-Basket shall have been exceeded) exceeds $177,500 (the “Threshold”), and then only for such Losses in excess of the Threshold; provided that this limitation shall not apply with respect to such claims shall exceed on a cumulative basis an amount equal Losses arising out of or resulting from Special Indemnified Matters.
(iii) Notwithstanding anything to fifty thousand dollars (U.S.$50,000)the contrary herein, other than with respect to Special Indemnified Matters, in which no event Seller shall the Buyer Indemnitees be responsible only for entitled to recover more than the amount of such Damages cash then in excess the Escrow Account; provided that the maximum aggregate liability of fifty thousand dollars each of the Sellers for Losses arising out of or resulting from claims in respect of Special Indemnified Matters (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party including with respect to the indemnification claims of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller Fraud with respect to Special Indemnified Matters) shall be 75% (100% in the case of a breach of Section 4.4) of the net cash amount of the Purchase Price actually received by such claims Seller hereunder, provided, further however, that the Buyer Indemnities shall equal on a cumulative basis an amount equal first recover Losses for Special Indemnified Matters from the Escrow Account.
(iv) The Buyer Indemnitees shall not be entitled to five hundred thousand dollars (U.S.$500,000)recover from the Sellers, collectively, pursuant to this Article 8 more than once in respect of the same Losses suffered.
(d) No monetary Notwithstanding anything contained herein to the contrary, but subject to the Special Indemnified Matters as set forth in Section 8.5(c)(iii), after the Closing, on the date that the amount will of cash in the Escrow Account is reduced to zero, the Buyer Indemnitees shall have no further rights to indemnification under this Agreement.
(e) For purposes of this Article 8, any inaccuracy in or breach of any representation or warranty shall be payable by Purchaser determined without regard to any Seller materiality, Material Adverse Effect or other similar qualification contained in or otherwise applicable to such representation or warranty.
(f) Notwithstanding anything to the contrary contained herein, upon any Indemnified Party becoming aware of any claim as to which indemnification may be sought by such Indemnified Party pursuant to this Article 8, such Indemnified Party shall utilize commercially reasonable efforts, consistent with normal practices and policies, to mitigate such Losses, and any Losses to the extent directly resulting from such Indemnified Party’s failure to comply with the foregoing shall be excluded from the Losses recoverable by such Indemnified Party from the Responsible Party hereunder.
(g) No Responsible Party shall be liable for any Losses in respect of any liability or Loss which is contingent unless and until such contingent liability or Loss becomes an actual liability or Loss and is due and payable. No Responsible Party shall be liable to pay any amount in discharge of a claim under this Article 8 unless and until the liability or Loss in respect of which the claim is made has become due and payable.
(h) No Indemnified Party shall have any right to assert any claim against any indemnifying party hereunder (an “Indemnifying Party”) with respect to any Loss, cause of action or other claim to the indemnification extent such Loss, cause of any claims pursuant to Section 8.2(iaction or claim is a Loss, cause of action or claim: (i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to which such claims shall exceed on a cumulative basis an amount equal Indemnified Party or any of its affiliates has taken action (or caused to fifty thousand dollars (U.S.$50,000), be taken) with the primary intent of accelerating the time period in which event Purchaser shall such matter is asserted or payable in order to cause a claim to be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect made prior to the indemnification of any claims pursuant applicable Survival Date; or (ii) arising from or related to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)Non-Permitted Testing.
Appears in 1 contract
Limitations on Indemnification Obligations. (a) The amount which any Party Except in the case of fraud (an "Indemnifying Party") is or may be required to pay to any Person (an "Indemnified Party") in respect of Damages or other Liability for which indemnification is provided all applicable legal and equitable remedies will be available to Buyer), Buyer and the Buyer Indemnified Parties shall only be entitled to assert claims under this Agreement shall be reduced by any amounts actually received (including Insurance Proceeds actually received) by or on behalf of such Indemnified Party (net of increased insurance premiums and charges Section 6.2 up to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after the full aggregate amount of such Damages has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such Damages, less (B) the amount 5% of the indemnity payment that would have been due if Closing Date Cash Payment (the “Liability Cap”), which shall represent the sole and exclusive remedy of Buyer and the other Buyer Indemnified Parties for any such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was madeclaims under Section 6.2.
(b) In determining Payments by an Indemnifying Party pursuant to Section 6.2 or Section 6.3 in respect of any Loss shall be limited to the amount of any indemnity liability or damage that remains after deducting therefrom any insurance proceeds, indemnity, contribution or other similar payment under this Agreement, actually received from or committed to by a third party insurer or other third party prior to the payment due date hereunder for such amount shall be (i) reduced to take into account any net Tax benefit realized by the Loss. The Indemnified Party and shall use its Affiliates arising from commercially reasonable efforts to recover under insurance policies or indemnity, contribution or other similar agreements for any Loss in the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which time period prior to such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments due date hereunder (grossed-up for such increase)Loss. The failure to achieve such recovery shall not, in each case determined by treating however, relieve the Indemnified Indemnifying Party and of its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment indemnification obligations hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Each Indemnified Party with respect shall take, and cause its Affiliates and Representatives to the take, all commercially reasonable steps to mitigate any Loss for which indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall may be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)sought under this Agreement.
(d) No monetary amount will Seller shall not be payable by Purchaser liable to Buyer, including under this Article VI, for any Seller Indemnified Party Losses based upon or arising out of any facts, circumstances or events if such fact, circumstance or event was made available to Buyer prior to Closing or if Buyer or any of the contractors or subcontractors of Buyer had knowledge of such fact, circumstance or event, in each case prior to the Closing.
(e) Buyer has conducted, or has had the opportunity to conduct, real estate title searches with respect to the indemnification Sanitary Sewer System to its satisfaction, and Seller shall not be liable to Buyer, including under this Article VI, for any Losses based upon or arising out of any claims pursuant facts, circumstances or events related to the title, including lack thereof, imperfections in title, or liens or encumbrances of any kind, to the real estate included in the Sanitary Sewer System or the other Assets.
(f) Subject to Section 8.2(i8.21 (Specific Performance) until and any other provisions for specific performance, the aggregate amount of Damages actually incurred by the Seller Indemnified Parties acknowledge and agree that their sole and exclusive remedy with respect to any and all claims for any breach of any representation, warranty, covenant, agreement or obligation set forth herein or otherwise relating to the subject matter of this Agreement, unless such claims shall exceed are based on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000)fraud, in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect pursuant to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).provisions set forth in this Article
Appears in 1 contract
Samples: Asset Purchase Agreement
Limitations on Indemnification Obligations. (a) The amount which any Party (an "Indemnifying Party") is or may be required to pay In addition to any Person (an "other limitations contained in Articles VIII and IX hereof, the obligations of Sellers, Purchaser and LLANY to indemnify any Purchaser Indemnified Party or Sellers' Indemnified Party", as the case may be, are subject to, and limited by, the following:
(i) in respect of Damages or other Liability for which Sellers shall be obligated to provide indemnification is provided under this Article IX or under any Ancillary Agreement shall be reduced by on account of any amounts actually received (including Insurance Proceeds actually received) by misrepresentation or on behalf breach of such Indemnified Party (net of increased insurance premiums and charges warranty only to the extent related that the aggregate dollar amount of Losses with respect to Damages all misrepresentations and costs and expenses (including reasonable legal fees and expensesbreaches of warranty referred to in Section 9.01(a)(i) exceeds $30 million, but only for the amount in excess of $30 million. Sellers further shall be obligated to provide indemnification under this Article IX on account of Sellers' Extra Contractual Obligations only to the extent that the aggregate dollar amount of Losses incurred by Purchaser or LLANY, as applicable, with respect to such Indemnified Party Sellers' Extra Contractual Obligations exceeds $10 million, but only for the amount in connection with seeking to collect and collecting such amounts) in respect excess of such Damages $10 million. Losses incurred by Purchaser, or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after the full amount of such Damages has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such DamagesLLANY, then the Indemnified Party shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in , with respect of such Damages, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the amount of any indemnity payment under this Agreement, such amount to Sellers' Extra Contractual Obligations shall be (i) reduced to take into account any net Tax benefit realized by applied against the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up $30 million deductible provided for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authorityabove, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treatedLosses exceed $10 million and are indemnified by Sellers.
(cii) No monetary The maximum aggregate liability of Sellers for indemnification for all Losses subject to indemnification under this Article IX including, without limitation, any amount paid pursuant to Section 9.05(a)(i) shall be $500 million; provided however, that Losses that constitute Direct Economic Losses shall not be subject to such $500 million limitation.
(iii) Each Indemnified Party shall be obligated to use its commercially reasonable efforts to mitigate to the extent reasonably practicable the amount of any Losses for which it is entitled to seek indemnification hereunder.
(iv) Upon making any indemnification payment, the Indemnifying Party will, to the extent of such payment, be subrogated to all rights of the Indemnified Party against any third party in respect of the Loss to which the payment relates; provided, however, that until the Indemnified Party recovers full payment of its Loss, any and all claims of the Indemnifying Party against any such third party on account of said payment are hereby made expressly subordinated and subjected in right of payment to the Indemnified Party's rights against such third party. Without limiting the generality of any other provision hereof, each such Indemnified Party and Indemnifying Party will duly execute upon request all instruments reasonably necessary to evidence and perfect the above-described subrogation and subordination rights.
(v) The amount of any Losses sustained by an Indemnified Party and owed by an Indemnifying Party shall be payable reduced by Seller to any Purchaser amount received by such Indemnified Party with respect thereto under any insurance or reinsurance coverage or from any other party alleged to be responsible therefor. The Indemnified Party shall use reasonable efforts to collect any amounts available under such insurance or reinsurance coverage and from such other party alleged to have responsibility. If the Indemnified Party receives an amount under insurance or reinsurance coverage or from such other party with respect to Losses sustained at any time subsequent to any indemnification actually paid pursuant to this Article IX, then, subject to the immediately preceding sentence, such Indemnified Party shall promptly reimburse the applicable Indemnifying Party for any such indemnification payment actually made by such Indemnifying Party up to the actual amount of insurance actually received.
(vi) Any indemnification payments recoverable by an Indemnified Party pursuant to this Article IX shall be net of any claims pursuant Federal or state income tax benefits to Section 8.1(i) until such Indemnified Party as a result of the aggregate Loss as to which the payment is made, provided that if the payment so recoverable will result in an increase in the income taxable for Federal or state income tax purposes by the Indemnified Party, the amount of Damages actually incurred the payment will be increased so that the Indemnified Party will receive on an after tax basis the full amount of the indemnification contemplated by this Article IX.
(vii) Purchaser acknowledges and agrees that, notwithstanding anything to the contrary contained in Article III of this Agreement, Sellers make no representation, warranty, guaranty or covenant regarding, and shall have no obligation to indemnify the Purchaser Indemnified Parties with respect to, the ultimate adequacy or sufficiency of any reserves reflected, or the ultimate collectibility of any reinsurance recoverable reported as an asset or contra-liability in any financial statement, book, record or account of the Sellers including, but not limited to, the Statutory Statements, ALIAC GAAP Statements, the Pro Forma Statements, the Closing Balance Sheet, Revised Closing Balance Sheet and Final Closing Balance Sheet.
(viii) During the periods set forth in Sections 8.01(a) and 8.01(c) during which Sellers have certain obligations to indemnify Purchaser, and Purchaser has certain obligations to indemnify Sellers, Purchaser, on the one hand, and Sellers, on the other hand, shall, no less than annually, provide the other party with a written statement summarizing any Claims Notices provided to such claims shall exceed on a cumulative basis an amount equal other party to fifty thousand dollars date, and setting forth the Losses incurred by such party for which such party is claiming indemnification against the other party in accordance with this Article IX.
(U.S.$50,000), in which event Seller ix) Purchaser and LLANY shall be responsible obligated to provide indemnification under this Article IX or under any Ancillary Agreement on account of any misrepresentation or breach of warranty only to the extent that the aggregate dollar amount of Losses with respect to all misrepresentations and breaches of warranty referred to in Section 9.01(b)(i) exceeds $10 million, but only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)$10 million.
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 1 contract
Samples: Asset Purchase Agreement (Aetna Life Insurance & Annuity Co /Ct)
Limitations on Indemnification Obligations. (a) The amount which any Party ------------------------------------------ party (an "Indemnifying Party") is or may be required to pay to any Person CST Indemnitee or Stream International Indemnitee (an "Indemnified PartyIndemnitee") in respect of Damages pursuant to Sections 5.1 or other Liability for which indemnification is provided under this Agreement 5.2 hereof shall be reduced (including, without limitation, retroactively) by any insurance proceeds or other amounts actually received (including Insurance Proceeds actually received) recovered by or on behalf of such Indemnified Indemnitee in reduction of the related Indemnifiable Loss. To the extent an Indemnifying Party makes full payment in respect of an Indemnifiable Loss and such Indemnifiable Loss is covered by an insurance policy which has not been the subject of an effective assignment to the Indemnifying Party, at the request of the Indemnifying Party, the Indemnitee shall use commercially reasonable efforts at the expense of the Indemnifying Party (net of increased which expenses shall be deemed to include any increase in insurance premiums and charges of the Indemnitee attributable to the extent related filing of such claims) to Damages enforce any and costs and expenses (including reasonable legal fees and expenses) incurred by all claims under such Indemnified Party in connection with seeking to collect and collecting such amounts) insurance policy in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts")Indemnifiable Loss for the benefit of the Indemnifying Party. If any Indemnified Indemnitee shall have received the full payment required by this Agreement from an Indemnifying Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after an Indemnifiable Loss and shall subsequently actually receive insurance proceeds or other amounts in respect of such Indemnifiable Loss, then such Indemnitee shall pay to such Indemnifying Party a sum equal to the full amount of such Damages has been paid by an Indemnifying Party insurance proceeds or after an Indemnifying Party has made a partial payment other amounts actually received (net of such Damages and such Indemnity Reduction Amounts any expenses in obtaining the same), but not to exceed the remaining unpaid balance net amount of such Damages, then the Indemnified Party shall promptly remit to payments previously received by the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by Indemnitee from the Indemnifying Party in respect of such Damages, less (B) the amount Indemnifiable Loss. An insurer who would otherwise be obligated to pay any claim shall not be relieved of the indemnity payment responsibility with respect thereto or, solely by virtue of the indemnification provisions hereof, have any subrogation rights with respect thereto, it being expressly understood and agreed that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the amount of no insurer or any indemnity payment under this Agreement, such amount other third party shall be entitled to a "windfall" (i) reduced i.e., a benefit they would not be entitled to take into account any net Tax benefit realized by receive in the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result absence of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined indemnification provisions) by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention virtue of the Parties indemnification provisions hereof. Nothing herein shall require an Indemnitee to this Agreement that payments made pursuant enforce claims under an insurance policy before proceeding to this Agreement are enforce its rights to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treatedindemnification against an Indemnifying Party.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 1 contract
Samples: Contribution Agreement (Stream International Holdings Inc)
Limitations on Indemnification Obligations. (a) The amount which any Party (an "Indemnifying Party") is or may be required ’s obligation to pay to indemnify an Indemnified Party for any Person (an "Indemnified Party") in respect of Damages or other Liability for which indemnification is provided Loss under this Agreement Article 10 shall be reduced by any amounts actually received reduced:
(including Insurance Proceeds actually receivedi) by or on behalf the amount of any sum such Indemnified Party has recovered from any third Person, including an insurer, in compensation for such Loss, after deduction of all duly documented costs and expenses incurred in making such recovery (net of increased insurance premiums including reasonable attorneys’ fees); provided, however, the Indemnifying Party shall not be obligated to seek compensation from such third Person;
(ii) if and charges to the extent related the Parent, the Buyer or any of their Affiliates consented to Damages an action as per Article 5.3.1;
(iii) if and costs to the extent that such Loss is covered by any specific provision, reserve or expense in the Financials relating to such claim;
(iv) if and expenses (including reasonable legal fees and expenses) incurred by to the extent that such Indemnified Party in connection with seeking to collect and collecting such amounts) in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after the full amount of such Damages Loss has been paid caused or increased by an Indemnifying Party or after an Indemnifying Party has made a partial payment failure of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit or any of its Affiliates or, as from the Closing Date, any Group Company or any of its Affiliates, to comply with the duty to mitigate the damage; or
(v) if and to the extent that such Loss arises or is increased as a result of any new legislation, regulation, rule of law or practice not in force at the Closing Date or any amendment of any legislation, regulation, rule of law or practice after the Closing Date.
(b) The Indemnifying Party an amount equal shall not have any obligation to indemnify the excess (if anyIndemnified Party under Article 10.2(a) of (A) unless the amount theretofore paid by of the Indemnifying Party’s obligation to indemnify the Indemnified Party exceeds, or when aggregated with the amount of the total indemnification obligation of the Indemnifying Party in respect of such Damagesall claims will exceed, less EUR 850,000 (B) the amount of Threshold Amount). If the indemnity payment that would have Threshold Amount has been due if such Indemnity Reduction Amounts in respect thereof had been received before exceeded, the indemnity payment was made.
(b) In determining the amount of any indemnity payment under this Agreement, such amount Indemnifying Party shall be (i) reduced required to take into account any net Tax benefit realized by indemnify the Indemnified Party from and its Affiliates arising from the incurrence against any and all Losses suffered or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party Party, and its Affiliates as a result not just the Losses in excess of the receipt or accrual of payments hereunder Threshold Amount; provided, however, that the Threshold Amount shall not apply to:
(grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing i) any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention indemnification obligation of the Parties to under Article 10.2(a) resulting from, arising out of or based upon, any fraudulent or wilful misrepresentation or fraudulent or willful breach of warranty;
(ii) any indemnification obligation of the Parties under Article 10.2(b);
(iii) any indemnification obligation of the Sellers under Article 10.1; or
(iv) any indemnification obligation of the Sellers under Article 10.2(a) resulting from, arising out of or based upon, the breach of any of the representations and warranties set forth in Clause 1 (Organization of the Company and the Subsidiaries), Clause 2 (Company Capital Structure), Clause 3 (Subsidiaries), Clause 4 (Authority), Clause 9(k) (No Changes), Clause 10 (Taxes), Clause 22 (Social Security, Pensions and Benefit Plans) and Clause 28 (Siemens APA) of Annex 9.1, it being however understood and agreed by the Parties that if any Loss arises out of a misrepresentation or a breach of a warranty or covenant under this Agreement that payments made pursuant (including those set forth under (i) to this Agreement are (iv) above) for which Notice of Breach has been given on or prior to the Second Tranche Payment Date in accordance with Article 3.2.3(c), the amount claimed (whether disputed or not or whether the amount exceeds or not the Threshold Amount) shall be first deducted from the Second Tranche and be placed in escrow to be treated held by the Escrow Agent as relating back set forth in Article 3.2.3(c) before an Indemnified Party seeks to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treatedrecover directly from an Indemnifying Party.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the The aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties Sellers’ indemnification obligations to the Buyer and its Affiliates
(i) with respect regard to such claims any indemnification obligation of the Sellers under Article 10.2(a) resulting from, arising out of or based upon, the breach of any of the representations and warranties other than described in Subclause (ii) or (iii) below shall not exceed on a cumulative basis an amount equal EUR 8,300,000;
(ii) with regard to fifty thousand dollars any indemnification obligation of the Sellers under Article 10.1 or under Article 10.2(a) resulting from, arising out of or based upon, the breach of any of the representations and warranties set forth in Clause 10 (U.S.$50,000Taxes), in which event Seller shall be responsible only for the amount Clause 13 (Intellectual Property) and Clause 28 (Siemens APA) of such Damages in excess of fifty thousand dollars Annex 9.1 shall, together with any indemnification paid under Article 11.5(c)(i), not exceed EUR 26,970,000; and
(U.S.$50,000). No monetary amount will be payable by Seller iii) with regard to any Purchaser Indemnified Party with respect to indemnification obligation of the indemnification Sellers under Article 10.2(b) or under Article 10.2(a) resulting from, arising out of or based upon, the breach of any claims pursuant to Section 8.1(iof the representations and warranties set forth in Clause 1 (Organization of the Company and the Subsidiaries), Clause 2 (Company Capital Structure), Clause 3 (Subsidiaries) after and Clause 4 (Authority) of Annex 9.1 shall together with any indemnification paid under Article 11.5(c)(i) or Article 11.5(c)(ii), not exceed EUR 87,000,000; (the aggregate amount of Damages actually paid by Seller with respect to such claims limitations set forth in (i) through (iii) each a Cap and together the Caps) provided, however, that no Cap shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
(d) No monetary amount will be payable by Purchaser apply to any Seller Indemnified Party with respect to the indemnification obligation of any claims pursuant to Section 8.2(i) until the aggregate amount Seller resulting from, arising out of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000)or based upon, in which event Purchaser shall be responsible only for the amount any fraudulent or wilful misrepresentation or fraudulent or wilful breach of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)warranty.
Appears in 1 contract
Samples: Share Purchase Agreement (Nuance Communications, Inc.)
Limitations on Indemnification Obligations. (a) The Parties hereto intend that each Liability subject to indemnification, contribution or reimbursement pursuant hereto will be net of (i) all Insurance Proceeds and (ii) all recoveries, judgments, settlements, contributions, indemnities, and other amounts received (including by way of set-off) from all Third Parties, in each case that actually reduces the amount which any of, or are paid to the applicable indemnitee in respect of, such Liability ("Third Party Proceeds"). Accordingly, the amount that a Party (each, an "Indemnifying Party") is or may be required to pay to any each Person entitled to indemnification hereunder (each an "Indemnified Party") in respect of Damages or other Liability for which indemnification is provided under this Agreement shall be reduced by any amounts actually received (including all Insurance Proceeds actually received) and Third Party Proceeds received by or on behalf of such the Indemnified Party (net in respect of increased insurance premiums the relevant Liability; provided, however, that all amounts described in Section 9.2 or Section 9.3 which are incurred by an Indemnified Party shall be paid promptly by the Indemnifying Party and charges shall not be delayed pending any determination as to the extent related availability of Insurance Proceeds or Third Party Proceeds; provided, further, however, that upon such payment by or on behalf of an Indemnifying Party to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such an Indemnified Party in connection with seeking a Third Party Claim, to collect the extent permitted by Applicable Laws such Indemnified Party shall assign its rights to recover all Insurance Proceeds and collecting Third Party Proceeds to the Indemnifying Party and such amountsIndemnifying Party shall be subrogated to and shall stand in the place of such Indemnified Party as to all events and circumstances in respect of which such Indemnified Party may have with respect to all rights, defenses, and claims relating to such Third Party Claim. If, notwithstanding the second proviso in the preceding sentence, an Indemnified Party receives a payment required to be made under this Article IX (an "Indemnity Payment") from an Indemnifying Party in respect of a Liability and subsequently receives Insurance Proceeds or Third Party Proceeds in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after the full amount of such Damages has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such DamagesLiability, then the Indemnified Party shall promptly remit pay to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such Damages, less (B) over the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof Insurance Proceeds and Third Party Proceeds had been received before the indemnity payment Indemnity Payment was made. Each HyperScale Entity and each ACC Entity shall use reasonable best efforts to seek to collect or recover all Insurance Proceeds and all Third Party Proceeds to which such Person is entitled in respect of a Liability for which such Person seeks indemnification pursuant to this Article IX; provided, however, that such Person's inability to collect or recover any such Insurance Proceeds or Third Party Proceeds shall not limit the Indemnifying Party's obligations hereunder.
(b) In determining An insurer that would otherwise be obligated to pay a claim shall not be relieved of the amount responsibility with respect thereto or, solely by virtue of the indemnification provisions hereof, have any indemnity payment under this Agreementsubrogation rights with respect thereto, such amount it being expressly understood and agreed that no insurer or other Third Party shall be entitled to a "windfall" (i) reduced i.e., a benefit it would not be entitled to take into account any net Tax benefit realized by receive in the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result absence of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined indemnification provisions hereof) by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention virtue of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treatedindemnification provisions hereof.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 1 contract
Samples: Separation and Distribution Agreement (American Cannabis Company, Inc.)
Limitations on Indemnification Obligations. (a) The parties hereto intend that each Liability subject to indemnification, contribution or reimbursement pursuant hereto will be net of (i) all Insurance Proceeds, and (ii) all recoveries, judgments, settlements, contribution, indemnities and other amounts received (including by way of set-off) from all Third Parties, in each case that actually reduce the amount which any of, or are paid to the applicable indemnitee in respect of, such Liability (“Third Party Proceeds”). Accordingly, the amount that a party (each, an "“Indemnifying Party"”) is or may be required to pay to any Person each Entity entitled to indemnification hereunder (each an "“Indemnified Party"”) in respect of Damages or other Liability for which indemnification is provided under this Agreement shall be reduced by any amounts actually received (including all Insurance Proceeds actually received) and Third Party Proceeds received by or on behalf of such the Indemnified Party (net in respect of increased insurance premiums the relevant Liability; provided, however, that all amounts described in Section 9.2 or Section 9.3 which are incurred by an Indemnified Party shall be paid promptly by the Indemnifying Party and charges shall not be delayed pending any determination as to the extent related availability of Insurance Proceeds or Third Party Proceeds; provided, further, that upon such payment by or on behalf of an Indemnifying Party to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such an Indemnified Party in connection with seeking a Third Party Claim, to collect the extent permitted by Applicable Laws such Indemnified Party shall assign its rights to recover all Insurance Proceeds and collecting Third Party Proceeds to the Indemnifying Party and such amountsIndemnifying Party shall be subrogated to and shall stand in the place of such Indemnified Party as to all events and circumstances in respect of which such Indemnified Party may have with respect to all rights, defenses, and claims relating to such Third Party Claim. If, notwithstanding the second proviso in the preceding sentence, an Indemnified Party receives a payment required to be made under this Article IX (an “Indemnity Payment”) from an Indemnifying Party in respect of a Liability and subsequently receives Insurance Proceeds or Third Party Proceeds in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after the full amount of such Damages has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such DamagesLiability, then the Indemnified Party shall promptly remit pay to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such Damages, less (B) over the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof Insurance Proceeds and Third Party Proceeds had been received before the indemnity payment Indemnity Payment was made. Each EATC UT Entity and each EATC NV Entity shall use reasonable best efforts to seek to collect or recover all Insurance Proceeds and all Third Party Proceeds to which such Entity is entitled in respect of a Liability for which such Entity seeks indemnification pursuant to this Article IX; provided, however, that such Entity’s inability to collect or recover any such Insurance Proceeds or Third Party Proceeds shall not limit the Indemnifying Party’s obligations hereunder.
(b) In determining An insurer that would otherwise be obligated to pay a claim shall not be relieved of the amount responsibility with respect thereto or, solely by virtue of the indemnification provisions hereof, have any indemnity payment under this Agreementsubrogation rights with respect thereto, such amount it being expressly understood and agreed that no insurer or other third party shall be entitled to a “windfall” (i) reduced i.e., a benefit it would not be entitled to take into account any net Tax benefit realized by receive in the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result absence of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined indemnification provisions hereof) by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention virtue of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treatedindemnification provisions hereof.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 1 contract
Samples: Asset Transfer and Dividend Distribution Agreement (Energy Alliance Technology Corp)
Limitations on Indemnification Obligations. (a) The amount which any Party party (an "“Indemnifying Party"”) is or may be required to pay to any Person (an "Indemnified Party") Indemnitee in respect of Damages Indemnifiable Losses or other Liability for which indemnification is provided under this Agreement shall be reduced by any amounts actually received (including Insurance Proceeds actually received) by or on behalf of such Indemnified Party Indemnitee (net of increased insurance premiums and charges related directly and solely to the extent related to Damages Indemnifiable Losses and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party Indemnitee in connection with seeking to collect and collecting such amounts) in respect of such Damages Indemnifiable Losses or other Liability (such net amounts are referred to herein as "“Indemnity Reduction Amounts"”). If any Indemnified Party Indemnitee receives any Indemnity Reduction Amounts in respect of Damages an Indemnifiable Loss for which indemnification is provided under this Agreement after the full amount of such Damages Indemnifiable Loss has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages Indemnifiable Loss and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such DamagesIndemnifiable Loss, then the Indemnified Party Indemnitee shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such DamagesIndemnifiable Loss, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made. An insurer or other third party who would otherwise be obligated to pay any claim shall not be relieved of the responsibility with respect thereto or, solely by virtue of the indemnification provisions hereof, have any subrogation rights with respect thereto, it being expressly understood and agreed that no insurer or any other third party shall be entitled to any benefit they would not be entitled to receive in the absence of the indemnification provisions by virtue of the indemnification provisions hereof.
(b) In determining the amount of any indemnity payment under this AgreementIndemnifiable Losses, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates Indemnitee arising from the incurrence or payment by the Indemnified Party or its Affiliates Indemnitee of any amount in respect of which such payment is made Indemnifiable Losses and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates Indemnitee as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates Indemnitee as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effectIndemnifiable Losses. It is the intention of the Parties to this Agreement parties that indemnity payments made pursuant to this Agreement are to be treated as relating back to the Closing Date Distribution as a purchase price adjustmentan adjustment to capital (i.e., capital contribution or distribution), and the Parties parties shall not take any position inconsistent with such intention before any Tax authorityAuthority (as defined in the Tax Allocation Agreement), except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 1 contract
Limitations on Indemnification Obligations. The rights to indemnification pursuant to the provisions of Section 9.2 or Section 10.1 are subject to the following limitations:
(a) The amount of any and all Losses will be determined net of (i) any specific accruals or specific reserves that were taken into account in the calculation of Actual Net Working Capital, (ii) any Tax benefit actually recognized by the Indemnified Party in the taxable year in which such Loss occurs or in the two (2) immediately succeeding years, computed on a with and without basis, and (iii) any amounts actually received by an Indemnified Party (an "Indemnifying Party") is or may be required to pay to any Person (an "Indemnified Party") in respect of Damages such Losses pursuant to any insurance policy (net of any increase in premiums resulting from the applicable matter and net of all reasonable collection and other reasonable costs and expenses incurred or other Liability attributable to such insurance recovery). The amount of any such net Tax benefit shall be calculated by the Indemnified Party in good faith, and a responsible officer of the Indemnified Party shall notify the Responsible Party in writing of the basis of such calculation after each taxable year referred to in the immediately preceding sentence. If the amount to be netted hereunder is determined after payment of any amount otherwise required to be paid to an Indemnified Party under this Article IX or Section 10.1, the Indemnified Party shall repay to the Responsible Party, promptly after such determination, any amount that the Responsible Party would not have had to pay pursuant to this Article IX or Section 10.1 had such determination been made at the time of such payment;
(b) Prior to the Indemnification Escrow Termination Date, Buyer Indemnitees shall not be entitled to recover Losses pursuant to Section 9.2(a)(i) for any individual claim or claims arising out of the substantially same set of facts unless the Losses related to such claim or set of claims exceed $20,000 (provided such Losses shall be aggregated for purposes of calculating the General Basket);
(c) Buyer Indemnitees shall not be entitled to recover Losses pursuant to Section 9.2(a)(i) and Seller Indemnitees shall not be entitled to recover Losses pursuant to Section 9.2(b) until the total amount which Buyer Indemnitees or Seller Indemnitees, as the case may be, would recover, but for this Section 9.4(c), exceeds $500,000 (the “General Basket”), and then only for the excess over the General Basket; provided, that this Section 9.4(c) shall not apply to a breach or inaccuracy of any of the Fundamental Representations by the Company or Parent or a breach or inaccuracy of any of the Fundamental Representations by Buyer or Guarantor;
(d) Buyer Indemnitees shall not be entitled to recover Losses pursuant to Section 9.2(a)(ix) until the total amount which Buyer Indemnitees would recover, but for this Section 9.4(d), exceeds $100,000 (the “Covenant Basket”), and then only for the excess over the Covenant Basket; provided, that any Losses incurred by Buyer Indemnitees pursuant to Section 9.2(a)(ix) that do not exceed the Covenant Basket shall be counted towards the General Basket;
(e) Absent fraud or intentional misrepresentation, (i) the sole recourse for indemnifiable Losses pursuant to Section 9.2(a)(i), except for breaches of Fundamental Representations, to the extent not covered by the R&W Insurance Policy, shall be the Indemnification Escrow Fund and the R&W Insurance Policy, (ii) the aggregate total amount of Losses in respect of which Buyer Indemnitees shall be entitled to recover solely pursuant to Section 9.2(a)(ii), (iii), (v), and (ix) and Section 10.1 (and not also pursuant to Section 9.2(a)(i)) shall not exceed $25,000,000, (iii) the aggregate total amount of Losses in respect of which Buyer Indemnitees shall be entitled to recover pursuant to this Agreement (except with respect to Losses incurred pursuant to Section 9.2(a)(vi), Section 9.2(a)(viii), and Section 9.2(a)(x)) shall not exceed an amount equal to the Purchase Price (as of the date of determination), and (iv) the aggregate total amount of Losses in respect of which Seller Indemnitees shall be entitled to recover pursuant to Section 9.2(b) shall not exceed $25,000,000;
(f) All indemnification is provided payments made under this Agreement shall be reduced treated by any amounts actually received (including Insurance Proceeds actually received) by or on behalf of such Indemnified Party (net of increased insurance premiums and charges the parties as an adjustment to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred Purchase Price for Tax purposes, unless otherwise required by such Indemnified Party in connection with seeking to collect and collecting such amounts) in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after the full amount of such Damages has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such Damages, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the amount of any indemnity payment under this Agreement, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).Applicable Law; and
Appears in 1 contract
Limitations on Indemnification Obligations. The indemnity obligations of Seller and Buyer contained in Sections 10.03 and 10.04 are subject to the following limitations:
(a) The amount which any Party (an "Indemnifying Party") is or may be required to pay to any Person (an "Indemnified Party") in respect of Damages or other Liability for which indemnification is provided under this Agreement Neither Seller nor Buyer shall be reduced liable to the other for any punitive, exemplary, consequential or special damages, provided that such limitation shall not apply to assumption and indemnity obligations with respect to claims made by any amounts actually received (including Insurance Proceeds actually received) by or on behalf of such Indemnified Party (net of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after the full amount of such Damages has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such Damages, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.third party;
(b) In determining Except as provided in Section 10.05(d), neither Seller nor Buyer shall be liable to, nor have any obligation to indemnify the amount other party unless and until the other party has 18 incurred aggregate Losses arising out of any indemnity payment under the matters described in Section 10.03 or 10.04 of this Agreement, such amount as the case may be, in excess of a deductible of $100,000.00, after which the indemnifying party shall be obligated to indemnify the other party from and against any further Losses which are in excess of such deductible amount up to, but not exceeding, an aggregate amount of $1,000,000.00 for all Losses incurred by the other party; and
(c) Except as provided in Section 10.05(d), no Party shall be obligated to indemnify the other for the breach of any representation or warranty, or for any other matter, to the extent that the Party claiming a Loss as a result thereof had actual knowledge of such breach or other matter at or prior to the Closing; and
(d) The limitations set forth in subsections (b) and (c) of this Section 10.05 shall not be applicable to (i) reduced third party claims arising out of Buyer's assumption and indemnity obligations with respect to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and Abandonment and/or Environmental Obligations, (ii) increased claims related to take into account any net Tax cost incurred by the Indemnified Party adjustments to and its Affiliates as a result final settlement of the receipt Purchase Price pursuant to Sections 2.02, 8.02(b) and 9.01, nor (iii) claims arising out of Buyer's failure to pay or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating otherwise satisfy obligations arising under the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax costContracts, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention NPI Documents or other obligations of the Parties to this Agreement that payments made Seller which are assumed by Buyer pursuant to this Agreement are to be treated as relating back attributable to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 period of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) time after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)Effective Time.
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 1 contract
Limitations on Indemnification Obligations. (a) The amount of any Losses for which any Party (an "Indemnifying Party") is or the Buyer Indemnitees may be required entitled to pay indemnification pursuant to the provisions of Section 9.2(a) will be determined net of the amount of any Person Losses to the extent such Losses were included as a liability in the calculation of Net Working Capital.
(b) To the extent permitted by applicable Law, in no event shall Seller or any of its Affiliates, on the one hand, or Buyer or any of its Affiliates, on the other hand, be liable to Buyer or any Buyer Indemnitee or Seller or any Seller Indemnitee, as applicable, for, and the definition of “Losses” shall exclude, any (i) punitive damages; or (ii) any indirect, special or consequential losses that are not a reasonably foreseeable result of the matter giving rise to a claim for indemnification hereunder, in each case unless any such damages are of a third party and are actually assessed against an "Indemnified Party") Party in respect of Damages or other Liability a valid Third Party Claim for which indemnification is provided under available hereunder. Other than with respect to any valid Third Party Claim, this Agreement limitation shall apply regardless of whether any Litigation, claim or demand seeking or related to any of the foregoing damages is based on breach of contract, breach of warranty, tort or otherwise, and shall apply even where such damages (or the events giving rise to such damages) are caused, in whole or in part, by the negligence, gross negligence or acts and omissions of Seller or Buyer or any of their respective Affiliates. This Section 9.4(b) shall survive termination or cancellation of this Agreement.
(c) The amount of any and all Losses indemnified pursuant to Section 9.2 will be reduced (i) determined net of an amount equal to any Tax savings or benefits actually realized in cash for the taxable year in which such Losses are incurred or for any taxable year ending before the date on which the indemnification payment is made pursuant to this Article IX by the Indemnified Party, in each case, that is attributable to any amounts actually received (including Insurance Proceeds actually received) by deduction, loss, credit or on behalf other Tax saving or benefit resulting from or arising out of such Indemnified Losses, provided that the Responsible Party (net of increased insurance premiums and charges shall pay to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after the full amount of such Damages has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit to the Indemnifying Party an amount equal to the excess any such Tax benefit (if any) of (A) the amount theretofore paid plus any penalties, interest or other charges imposed by the Indemnifying Party relevant Governmental Authority) in respect of the event such Damages, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the amount of any indemnity payment under this Agreement, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made disallowed and (ii) increased to take into account by any net Tax cost incurred by the Taxes or reduction in refund (including any interest with respect thereto) of any Indemnified Party and its Affiliates as a result resulting from or arising out of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)9.2.
(d) No monetary The amount of any and all Losses will be payable by Purchaser determined net of (A) any liabilities to any Seller Indemnified Party the extent included as a deduction in the calculation of the Final Statement of Purchase Price with respect to the indemnification matters to which such Losses relate, and (B) any amounts to the extent actually recovered by the Buyer Indemnitees net of any claims pursuant to Section 8.2(i) until the aggregate amount costs of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)recovery.
Appears in 1 contract
Limitations on Indemnification Obligations. (a) The amount which any Party party (an "Indemnifying Party") is or may be required to pay to any Person (an "Indemnified Party") Indemnitee in respect of Damages Indemnifiable Losses or other Liability for which indemnification is provided under this Agreement shall be reduced by any amounts actually received (including Insurance Proceeds actually received) by or on behalf of such Indemnified Party Indemnitee 69 74 (net of increased insurance premiums and charges related directly and solely to the extent related to Damages Indemnifiable Losses and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party Indemnitee in connection with seeking to collect and collecting such amounts) in respect of such Damages Indemnifiable Losses or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party Indemnitee receives any Indemnity Reduction Amounts in respect of Damages an Indemnifiable Loss for which indemnification is provided under this Agreement after the full amount of such Damages Indemnifiable Loss has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages Indemnifiable Loss and such Indemnity Reduction Amounts exceed exceeds the remaining unpaid balance of such DamagesIndemnifiable Loss, then the Indemnified Party Indemnitee shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such DamagesIndemnifiable Loss, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made. An insurer or other third party who would otherwise be obligated to pay any claim shall not be relieved of the responsibility with respect thereto or, solely by virtue of the indemnification provisions hereof, have any subrogation rights with respect thereto, it being expressly understood and agreed that no insurer or any other third party shall be entitled to any benefit they would not be entitled to receive in the absence of the indemnification provisions by virtue of the indemnification provisions hereof.
(b) In determining the amount of any indemnity payment under this AgreementIndemnifiable Losses, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates Indemnitee arising from the incurrence or payment by the Indemnified Party or its Affiliates Indemnitee of any amount in respect of which such payment is made Indemnifiable Losses and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates Indemnitee as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates Indemnitee as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effectIndemnifiable Losses. It is the intention of the Parties parties to this Agreement that indemnity payments made pursuant to this Agreement are to be treated as relating back to the Closing Date Distribution as a purchase price adjustmentan adjustment to capital (i.e., capital contribution or distribution), and the Parties parties shall not take any position inconsistent with such intention before any Tax authorityAuthority (as defined in the Tax Allocation Agreement), except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 1 contract
Limitations on Indemnification Obligations. (a) The amount which any Party party (an "Indemnifying Party") is or may be required to pay to any Person (an "Indemnified Party") Indemnitee in respect of Damages Indemnifiable Losses or other Liability for which indemnification is provided under this Agreement shall be reduced by any amounts actually received (including including, without limitation, Insurance Proceeds actually received) by or on behalf of such Indemnified Party Indemnitee (net of increased insurance premiums and charges related directly and solely to the extent related to Damages Indemnifiable Losses and costs and expenses (including including, without limitation, reasonable legal fees and expenses) incurred by such Indemnified Party Indemnitee in connection with seeking to collect and collecting such amounts) in respect of such Damages Indemnifiable Losses or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party Indemnitee receives any Indemnity Reduction Amounts in respect of Damages an Indemnifiable Loss for which indemnification is provided under this Agreement after the full amount of such Damages Indemnifiable Loss has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages Indemnifiable Loss and such Indemnity Reduction Amounts exceed exceeds the remaining unpaid balance of such DamagesIndemnifiable Loss, then the Indemnified Party Indemnitee shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such DamagesIndemnifiable Loss, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made. An insurer or other third party who would otherwise be obligated to pay any claim shall not be relieved of the responsibility with respect thereto or, solely by virtue of the indemnification provisions hereof, have any subrogation rights with respect thereto, it being expressly understood and agreed that no insurer or any other third party shall be entitled to any benefit they 61 66 would not be entitled to receive in the absence of the indemnification provisions by virtue of the indemnification provisions hereof.
(b) In determining the amount of any indemnity payment under this AgreementIndemnifiable Losses, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates Indemnitee arising from the incurrence or payment by the Indemnified Party or its Affiliates Indemnitee of any amount in respect of which such payment is made Indemnifiable Losses and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates Indemnitee as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates Indemnitee as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treatedIndemnifiable Losses.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 1 contract
Samples: Distribution Agreement (Rockwell Semiconductor Systmes Inc)
Limitations on Indemnification Obligations. (a) Reductions for Insurance Proceeds and Other Recoveries. The amount which ------------------------------------------------------ that any Party party (an "Indemnifying Party") is or may be required to pay to any other Person (an "Indemnified PartyIndemnitee") in respect of Damages pursuant to Section 7.03, 7.04 or other Liability for which indemnification is provided under this Agreement 7.05, as applicable, shall be reduced (retroactively or prospectively) by any Insurance Proceeds or other amounts actually received (including Insurance Proceeds actually received) recovered from third parties by or on behalf of such Indemnified Party (net of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) Indemnitee in respect of such Damages the related Indemnifiable Loss. The existence of a claim by an Indemnitee for monies from an insurer or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts against a third party in respect of Damages for which any Indemnifiable Loss shall not, however, delay any payment pursuant to the indemnification is provided under this Agreement after the full amount of such Damages has been paid provisions contained herein and otherwise determined to be due and owing by an Indemnifying Party or after an Party. Rather the Indemnifying Party has made a partial shall make payment in full of such Damages the amount determined to be due and such Indemnity Reduction Amounts exceed owing by it against an assignment by the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit Indemnitee to the Indemnifying Party of the entire claim of the Indemnitee for Insurance Proceeds or against such third party. Notwithstanding any other provisions of this Agreement, it is the intention of the parties that no insurer or any other third party shall be (i) entitled to a benefit it would not be entitled to receive in the absence of the foregoing indemnification provisions, or (ii) relieved of the responsibility to pay any claims for which it is obligated. If an amount equal to Indemnitee has received the excess (if any) of (A) the amount theretofore paid payment required by the this Agreement from an Indemnifying Party in respect of any Indemnifiable Loss and later receives Insurance Proceeds or other amounts in respect of such DamagesIndemnifiable Loss, less then such Indemnitee shall hold such Insurance Proceeds or other amounts in trust for the benefit of the Indemnifying Party (Bor Indemnifying Parties) and shall pay to the Indemnifying Party, as promptly as practicable after receipt, a sum equal to the amount of such Insurance Proceeds or other amounts received, up to the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the aggregate amount of any indemnity payment under this Agreement, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates arising payments received from the incurrence or payment by the Indemnified Indemnifying Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess Indemnifiable Loss (or, if there is more than one Indemnifying Party, the Indemnitee shall pay each Indemnifying Party, its proportionate share (based on payments received from the Indemnifying Parties) of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000Insurance Proceeds).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 1 contract
Samples: Distribution Agreement (Varian Inc)
Limitations on Indemnification Obligations. (a) The amount which any Party party (an "Indemnifying Party") is or may be required to pay to any Person (an "Indemnified Party") Indemnitee in respect of Damages Indemnifiable Losses or other Liability for which indemnification is provided under this Agreement shall be reduced by any amounts actually received (including including, without limitation, Insurance Proceeds actually received) by or on behalf of such Indemnified Party Indemnitee (net of increased insurance premiums and charges related directly and solely to the extent related to Damages Indemnifiable Losses and costs and expenses (including 55 60 reasonable legal fees and expenses) incurred by such Indemnified Party Indemnitee in connection with seeking to collect and collecting such amounts) in respect of such Damages Indemnifiable Losses or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party Indemnitee receives any Indemnity Reduction Amounts in respect of Damages an Indemnifiable Loss for which indemnification is provided under this Agreement after the full amount of such Damages Indemnifiable Loss has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages Indemnifiable Loss and such Indemnity Reduction Amounts exceed exceeds the remaining unpaid balance of such DamagesIndemnifiable Loss, then the Indemnified Party Indemnitee shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such DamagesIndemnifiable Loss, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made. An insurer or other third party who would otherwise be obligated to pay any claim shall not be relieved of the responsibility with respect thereto or, solely by virtue of the indemnification provisions hereof, have any subrogation rights with respect thereto, it being expressly understood and agreed that no insurer or any other third party shall be entitled to any benefit they would not be entitled to receive in the absence of the indemnification provisions by virtue of the indemnification provisions hereof.
(b) In determining the amount of any indemnity payment under this AgreementIndemnifiable Losses, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates Indemnitee arising from the incurrence or payment by the Indemnified Party or its Affiliates Indemnitee of any amount in respect of which such payment is made Indemnifiable Losses and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates Indemnitee as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates Indemnitee as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treatedIndemnifiable Losses.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 1 contract
Samples: Distribution Agreement (Rockwell International Corp)
Limitations on Indemnification Obligations. (a) REDUCTIONS FOR INSURANCE PROCEEDS AND OTHER RECOVERIES. The amount which that any Party (an "Indemnifying PartyINDEMNIFYING PARTY") is or may be required to pay to any other Person (an "Indemnified PartyINDEMNIFIED PARTY") in respect of Damages pursuant to SECTION 7.01 or other Liability for which indemnification is provided under this Agreement SECTION 7.02, as applicable, shall be reduced (retroactively or prospectively) by any amounts actually received (including Insurance Proceeds or other amount actually received) recovered from third parties by or on behalf of such Indemnified Party in respect of the related Indemnifiable Losses (net of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such except that nothing herein shall be construed as requiring any Indemnified Party in connection with seeking respect of any Spin Company Liability to collect and collecting such amounts) file any claim for insurance). The existence of a claim by an Indemnified Party for insurance or against a third party in respect of such Damages or other Liability (such net amounts are referred any Indemnifiable Loss shall not, however, delay any payment pursuant to the indemnification provisions contained herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after the full amount of such Damages has been paid and otherwise determined to be due and owing by an Indemnifying Party or after an Party. Rather the Indemnifying Party has made a partial shall make payment in full of such Damages amount so determined to be due and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such Damages, then owing by it against an assignment by the Indemnified Party shall promptly remit to the Indemnifying Party of the entire claim of the Indemnified Party for such insurance or against such third party. Notwithstanding any other provisions of this Agreement, it is the intention of the parties hereto that no insurer or any other third party shall be (i) entitled to a benefit it would not be entitled to receive in the absence of the foregoing indemnification provisions or (ii) relieved of the responsibility to pay any claims for which it is obligated. If an amount equal to Indemnified Party shall have received the excess (if any) of (A) the amount theretofore paid payment required by the this Agreement from an Indemnifying Party in respect of any Indemnifiable Losses and shall subsequently actually receive Insurance Proceeds or other amounts in respect of such DamagesIndemnifiable Losses, less (B) then such Indemnified Party shall hold such Insurance Proceeds in trust for the benefit of such Indemnifying Party and shall pay to such Indemnifying Party a sum equal to the amount of such Insurance Proceeds or other amounts actually received, up to the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the aggregate amount of any indemnity payment under this Agreement, payments received from such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Indemnifying Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)Indemnifiable Losses.
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 1 contract
Samples: Distribution Agreement (Single Source Electronic Transactions Inc)
Limitations on Indemnification Obligations. (a) Reductions for Insurance Proceeds and Other Recoveries. The amount which that any Party party (an "Indemnifying Party") is or may be required to pay to any Person person (an "Indemnified PartyIndemnitee") in respect of Damages pursuant to Section 5.1, Section 5.2 or other Liability for which indemnification is provided under this Agreement Section 5.3 above, as applicable, shall be reduced (retroactively or prospectively) by any Insurance Proceeds, other amounts actually received (including Insurance Proceeds actually received) recovered from third parties, or amounts recovered pursuant to any Ancillary Agreement, by or on behalf of such Indemnified Party (net of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) Indemnitee in respect of the related Losses. Each of the parties agrees that it shall use its best efforts to collect any such Damages Insurance Proceeds or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts")which it or any of its Subsidiaries may be entitled. If any Indemnified Party receives any Indemnity Reduction Amounts The existence of a claim by an Indemnitee for insurance or against a third party in respect of Damages for which any Loss shall not delay any payment pursuant to the indemnification is provided under this Agreement after the full amount of such Damages has been paid provisions contained herein and otherwise determined to be due and owing by an Indemnifying Party or after an Party; rather, the Indemnifying Party has made a partial shall make payment in full of such Damages amount so determined to be due and such Indemnity Reduction Amounts exceed owing by it against an assignment by the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit Indemnitee to the Indemnifying Party of the entire claim of the Indemnitee for such insurance or against such third party. No insurer or any other third party shall be (i) entitled to a benefit it would not be entitled to receive in the absence of the foregoing indemnification provisions, (ii) relieved of the responsibility to pay any claims for which it is obligated, or (iii) entitled to any subrogation rights with respect to any obligation arising under the foregoing indemnification provisions. If an amount equal to Indemnitee shall have received the excess (if any) of (A) the amount theretofore paid payment required by the this Agreement from an Indemnifying Party in respect of any Loss and shall subsequently actually receive Insurance Proceeds or other amounts in respect of such DamagesLoss, less (B) then such Indemnitee shall hold such Insurance Proceeds or other amounts in trust for the benefit of such Indemnifying Party and promptly shall pay to such Indemnifying Party a sum equal to the amount of such Insurance Proceeds or other amounts actually received, up to the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the aggregate amount of any indemnity payment under this Agreement, payments received from such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Indemnifying Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)Loss.
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 1 contract
Samples: Distribution Agreement (Columbia Hca Healthcare Corp/)
Limitations on Indemnification Obligations. (a) The amount which any Party party (an "Indemnifying Party") is or may be required to pay to any Person (an "Indemnified Party") Indemnitee in respect of Damages Indemnifiable Losses or other Liability for which indemnification is provided under this Agreement shall be reduced by any amounts actually received (including Insurance Proceeds actually received) by or on behalf of such Indemnified Party Indemnitee (net of increased insurance premiums and charges related directly and solely to the extent related to Damages Indemnifiable Losses and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party Indemnitee in connection with seeking to collect and collecting such amounts) in respect of such Damages Indemnifiable Losses or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party Indemnitee receives any Indemnity Reduction Amounts in respect of Damages an Indemnifiable Loss for which indemnification is provided under this Agreement after the full amount of such Damages Indemnifiable Loss has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages Indemnifiable Loss and such Indemnity Reduction Amounts exceed exceeds the remaining unpaid balance of such DamagesIndemnifiable Loss, then the Indemnified Party Indemnitee shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such DamagesIndemnifiable Loss, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made. An insurer or other third party who would otherwise be obligated to pay any claim shall not be relieved of the responsibility with respect thereto or, solely by virtue of the indemnification provisions hereof, have any subrogation rights with respect thereto, it being expressly understood and agreed that no insurer or any other third party shall be entitled to any benefit they would not be entitled to receive in the absence of the indemnification provisions by virtue of the indemnification provisions hereof.
(b) In determining the amount of any indemnity payment under this AgreementIndemnifiable Losses, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates Indemnitee arising from the incurrence or payment by the Indemnified Party or its Affiliates Indemnitee of any amount in respect of which such payment is made Indemnifiable Losses and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates Indemnitee as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates Indemnitee as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effectIndemnifiable Losses. It is the intention of the Parties parties to this Agreement that indemnity payments made pursuant to this Agreement are to be treated as relating back to the Closing Date Distribution as a purchase price adjustmentan adjustment to capital (i.e., capital contribution or distribution), and the Parties parties shall not take any position inconsistent with such intention before any Tax authorityAuthority (as defined in the Tax Allocation Agreement), except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 1 contract
Limitations on Indemnification Obligations. (ai) The amount which Purchaser Group shall not have a right to assert claims under any Party (an "Indemnifying Party") is or may be required to pay to any Person (an "Indemnified Party") in respect provision of Damages or other Liability for which indemnification is provided under this Agreement shall be reduced by for any amounts actually received (including Insurance Proceeds actually received) by or on behalf of such Indemnified Party (net of increased insurance premiums and charges Damages to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) in respect of that such Damages arise out of actions taken by or other Liability (such net amounts are referred omitted to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement be taken by Purchaser or the Finishing Business after the full Closing Date.
(ii) The rights of the Purchaser Group to indemnification pursuant to the provisions of Section 8.2(a) are subject to the following limitations: the amount of any and all Damages will be determined net of any (1) applicable accruals or reserves included in the calculation of the Net Operating Assets on the Final Closing Statement; (2) amounts actually recovered by the Purchaser Group under indemnification agreements or arrangements with third parties or under insurance policies with respect to such Damages has been paid by an Indemnifying Party (and no right of subrogation shall accrue to any such third party indemnitor or after an Indemnifying Party has made a partial payment of such Damages insurer hereunder), and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit to the Indemnifying Party (3) an amount equal to the excess Tax savings or benefits actually realized by the Purchaser Group that is attributable to any deduction, loss, credit or other Tax benefit resulting from or arising out of such Damages. An Indemnified Party shall use commercially reasonable efforts to collect any applicable insurance proceeds (if any) of including (A) the amount theretofore paid by an assignment to the Indemnifying Party in respect of such Damages, less its right to pursue claims thereto (to the extent freely assignable) and (B) providing the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts Indemnifying Party with reasonable assistance in respect thereof had been received before the indemnity payment was made.
(b) In determining the amount of any indemnity payment under this Agreement, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of pursuing any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes assigned claim (at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, Indemnifying Party’s sole cost and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000expense).
(diii) No monetary amount will Notwithstanding anything to the contrary contained herein, upon any Indemnified Party’s becoming aware of any claim as to which indemnification may be payable sought by Purchaser to any Seller such Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to this Article 8, such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party shall utilize all reasonable efforts, consistent with respect normal practices and policies and good commercial practice, to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to mitigate such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)Losses.
Appears in 1 contract
Samples: Asset Purchase Agreement (Graco Inc)
Limitations on Indemnification Obligations. (a) The amount which any Party party (an "Indemnifying Party") is or may be required to pay to any Person other party (an "Indemnified PartyIndemnitee") in respect of Damages or other Liability for which indemnification is provided under pursuant to this Agreement Article 5 hereof shall be reduced (including, without limitation, retroactively) by any insurance proceeds or other amounts actually received (including Insurance Proceeds actually received) recovered by or on behalf of such Indemnified Party (net Indemnitee in reduction of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred Indemnifiable Loss. If any Indemnitee shall have received the payment required by such Indemnified this Agreement from an Indemnifying Party in connection with seeking to collect respect of an Indemnifiable Loss and collecting such amounts) shall subsequently actually receive insurance proceeds or other amounts in respect of such Damages Indemnifiable Loss, then such Indemnitee shall pay to such Indemnifying Party a sum equal to the amount of such insurance proceeds or other Liability amounts actually received (such net amounts are referred of any expenses in obtaining the same), but not to herein as "Indemnity Reduction Amounts"). If any Indemnified exceed the net amount of the payments previously received by the Indemnitee from the Indemnifying Party receives any Indemnity Reduction Amounts in respect of Damages such Indemnifiable Loss.
(b) If any Indemnitee realizes a tax benefit or detriment in one or more tax periods by reason of having incurred an Indemnifiable Loss for which indemnification is provided under this Agreement after the full amount of such Damages has been paid by Indemnitee receives an Indemnity Payment from an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such DamagesParty, then the Indemnified Party such Indemnitee shall promptly remit pay to the such Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the tax benefit or such Indemnifying Party in respect shall pay to such Indemnitee an additional amount equal to the tax detriment (taking into account any tax detriment resulting from the receipt of such Damagesadditional amounts), less as the case may be. The amount of any tax benefit or any tax detriment for a tax period realized by an Indemnitee by reason of having incurred such Indemnifiable Loss shall be deemed to equal the product obtained by multiplying (Bi) the amount of any deduction or inclusion in income for such period resulting from such Indemnifiable Loss or the indemnity payment thereof, as the case may be, by (ii) its highest applicable marginal tax rate for such period (provided, however, that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the amount of any indemnity payment under this Agreement, such tax benefit -------- ------- attributable to an amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment that is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates creditable shall be deemed to be subject to equal the applicable Taxes at the maximum statutory rate then in effectamount of such creditable item). It is the intention of the Parties to Any payment due under this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code5.4(b) with respect to a tax benefit or tax detriment realized by an Indemnitee in a tax period shall be due and payable within 30 days from the recipient party causes time the return for such tax period is due, without taking into account any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect extension of time granted to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to party filing such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000)return. No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).Separation and Distribution Agreement
Appears in 1 contract
Samples: Separation and Distribution Agreement (Homebase Inc)
Limitations on Indemnification Obligations. The rights of the Parent Indemnified Parties to indemnification pursuant to the provisions of Section 9.2(a) are subject to the limitations set forth below.
(a) The amount which any Party (an "Indemnifying Party") is or may be required With respect to pay to any Person (an "Indemnified Party") in respect of claims for Damages or other Liability for which indemnification is provided under this Agreement shall be reduced by any amounts actually received (including Insurance Proceeds actually received) by or on behalf of such a Parent Indemnified Party (net of increased insurance premiums and charges pursuant to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by Section 9.2(a)(i), such Indemnified Party in connection with seeking to collect and collecting such amounts) in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after the full amount of such Damages has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such Damages, then the Parent Indemnified Party shall promptly remit be entitled to indemnification with respect to such Damages only when the Indemnifying aggregate of all Damages to such Parent Indemnified Party an amount equal other than Damages recoverable under Section 9.2(a)(ix) exceeds $1,000,000 (the “Deductible”), and then such Parent Indemnified Party shall be entitled to the indemnification only for its Damages that are in excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such Damages, less (B) the amount of the indemnity payment Deductible; provided, however, that would have been due if the Deductible shall not apply to claims for Damages by a Parent Indemnified Party pursuant to Section 9.2(a)(i) relating to Fundamental Representations or claims for fraud. The aggregate liability of all of the Sellers, on the one hand, and Parent, on the other hand, for Damages shall not exceed the Escrow Amount or be paid from any other source other than the Escrow Funds; provided, however, that such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was madelimitation shall not apply to claims for fraud.
(b) In determining No Seller shall be entitled to contribution from, or indemnification by, Parent or the amount Surviving Entity, directly or indirectly, under the Company’s Governing Documents, this Agreement, applicable corporate or other laws or otherwise, in respect of amounts due from a Seller to a Parent Indemnified Party under this ARTICLE IX, and Sellers shall hold the Company and the Parent Indemnified Parties harmless in respect of all such amounts and shall not seek to join the Company in connection with any indemnity payment suit arising under this Agreement, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable information or knowledge acquired, or investigations conducted, by Seller to Parent, Merger Sub or their respective representatives or otherwise shall in any Purchaser way limit, or constitute a waiver of, or a defense to, any right of a Parent Indemnified Party with respect to assert a claim for indemnification under this Agreement or the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)Escrow Agreement.
(d) No monetary amount will All materiality qualifications contained in the Company’s or the Sellers’ representations and warranties in this Agreement or in any Ancillary Document, including the term Company Material Adverse Effect, shall be payable by Purchaser to any Seller Indemnified Party taken into account under this ARTICLE IX solely for purposes of determining whether a breach or violation has occurred for which an indemnity obligation exists. Without limiting the generality of the foregoing, with respect to any representation or warranty that is breached, all such qualifications shall be ignored and not given effect for purposes of determining the indemnification amount of any claims Damages resulting from any such breach or violation.
(e) Notwithstanding any provisions of this Agreement to the contrary, none of the Sellers shall be responsible for, and the Parent Indemnified Parties shall not be entitled to, indemnification with respect to Taxes of a Group Company for a taxable period beginning after the Closing Date, or the portion of a Straddle Period beginning after the Closing Date, to the extent attributable the amount, expiration date, availability of or limitations on any Group Company Tax attributes, including any net operating loss, capital loss or credit carryover, and including tax bases of assets, or the depreciation or amortization thereof, of any Group Company. For the avoidance of doubt, this Section 9.4(e) shall not in any way be interpreted as limiting the obligations of Sellers to indemnify, defend and hold harmless the Parent Indemnified Parties pursuant to Section 8.2(i9.2(a)(vii) until the aggregate amount for Taxes of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed a Group Company for a taxable period ending on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect or prior to the indemnification Closing Date, or the portion of any claims pursuant to Section 8.2(i) after a Straddle Period ending on the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)Closing Date.
Appears in 1 contract
Samples: Merger Agreement (Aramark Corp)
Limitations on Indemnification Obligations. (a) The amount which any Party party (an "“Indemnifying Party"”) is or may be required to pay to any Person (an "Indemnified Party") Indemnitee in respect of Damages Indemnifiable Losses or other Liability for which indemnification is provided under this Agreement shall be reduced by any amounts actually received (including Insurance Proceeds actually received) by or on behalf of such Indemnified Party Indemnitee (net of increased insurance premiums and charges related directly and solely to the extent related to Damages Indemnifiable Losses and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party Indemnitee in connection with seeking to collect and collecting such amounts) in respect of such Damages Indemnifiable Losses or other Liability (such net amounts are referred to herein as "“Indemnity Reduction Amounts"”). If any Indemnified Party receives any Indemnity Reduction Amounts are received by or on behalf of an Indemnitee in respect of Damages an Indemnifiable Loss for which indemnification is provided under this Agreement after the full amount of such Damages Indemnifiable Loss has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages Indemnifiable Loss and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such DamagesIndemnifiable Loss, then the Indemnified Party Indemnitee shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such DamagesIndemnifiable Loss, less over (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made. An insurer or other third party who would otherwise be obligated to pay any claim shall not be relieved of the responsibility with respect thereto or, solely by virtue of the indemnification provisions hereof, have any subrogation rights with respect thereto, it being expressly understood and agreed that no insurer or any other third party shall be entitled to any benefit they would not be entitled to receive in the absence of the indemnification provisions by virtue of the indemnification provisions hereof.
(b) In determining the amount of any indemnity payment under this AgreementIndemnifiable Losses, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates Indemnitee arising from the incurrence or payment by the Indemnified Party or its Affiliates Indemnitee of any amount in respect of which such payment is made Indemnifiable Losses and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates Indemnitee as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates Indemnitee as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effectIndemnifiable Losses. It is the intention of the Parties parties to this Agreement that indemnity payments made pursuant to this Agreement are to be treated as relating back to the Closing Date Distribution as a purchase price adjustmentan adjustment to capital (i.e., capital contribution or distribution), and the Parties parties shall not take any position inconsistent with such intention before any Tax authorityAuthority (as defined in the Fortune/ACCO Tax Allocation Agreement), except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 1 contract
Limitations on Indemnification Obligations. (a) The amount which maximum aggregate indemnification for all Losses of an Indemnified Party shall be limited to 75% of the sum of the Closing Payment and Holdback Amount. The maximum aggregate indemnification of an Indemnified Party shall be net of any amounts recovered by the Indemnified Party (an "Indemnifying Party") is or may be required under insurance policies with respect to pay such Loss. The Indemnified Party shall in a timely fashion submit a claim to its insurance carrier with respect to any Person (an "Indemnified Party") in respect of Damages or other Liability Losses for which the Indemnifying Party is obligated to provide indemnification is provided under this Agreement hereunder.
(b) An Indemnifying Party shall not be reduced by any amounts actually received (including Insurance Proceeds actually received) by or on behalf obligated to indemnify against Losses of such the Indemnified Party (net of increased insurance premiums and charges to until the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after the full aggregate amount of such Damages has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed Losses exceeds Fifty Thousand Dollars ($50,000) (the remaining unpaid balance of such Damages“Indemnification Threshold”), then in which event the Indemnified Party shall promptly remit be entitled to such indemnification from the Indemnifying Party an amount equal for all Losses; provided, however, that the Indemnification Threshold shall not apply to Losses which are caused by or arise out of any fraudulent act of the excess (if any) Indemnifying Party or Losses that are caused by or arise out of (A) any intentional breach in the amount theretofore paid performance by the Indemnifying Party of any covenant or agreement made by the Indemnifying Party in respect of such Damages, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the amount of any indemnity payment under this Agreement, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will Any indemnification obligations of PCD or the Members hereunder shall first be payable by Seller to any Purchaser Indemnified Party with respect to from the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)Holdback Amount.
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 1 contract
Samples: Asset Acquisition Agreement (Mesa Laboratories Inc /Co)
Limitations on Indemnification Obligations. (a) The amount which any Party (an "Indemnifying Party") is or may Indemnification under this Article VIII shall not be required to pay available to any Person Indemnified Party unless such Indemnified Party first uses commercially reasonable efforts to obtain recovery from any Third Party Source (as defined below) for the applicable claim or Loss before making any claim for indemnification against the Responsible Party. The Responsible Party may, in its sole discretion, require any Indemnified Party to grant an "Indemnified Party") in respect assignment of Damages or other Liability for which indemnification is provided under this Agreement shall be reduced by any amounts actually received (including Insurance Proceeds actually received) by or on behalf the right of such Indemnified Party (net to assert a claim against any Third Party Source. If the amount to be netted hereunder from any payment required under Section 8.2(a) is determined after payment of increased insurance premiums and charges any amount otherwise required to the extent related be paid to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such an Indemnified Party in connection with seeking to collect and collecting such amounts) in respect of such Damages or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after the full amount of such Damages has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such DamagesArticle VIII, then the Indemnified Party shall promptly remit repay to the Indemnifying Responsible Parties, promptly after such determination, any amount that the Responsible Parties would not have had to pay pursuant to this Article VIII had such determination been made at the time of such payment.
(b) The Parent Indemnitees shall not have a right to assert claims under any provision of this Agreement for any Losses to the extent that such Losses relate to actions taken by or omitted to be taken by Parent or the Company after the Closing Date.
(c) The rights of the Parent Indemnitees to indemnification pursuant to the provisions of Section 8.2(a) are subject to the following limitations:
(i) The amount of any and all Losses will be determined net of any (A) accruals or reserves on the Company Financial Statements or the Conclusive Final Closing Statement, (B) amounts recovered by the Parent Indemnitees under indemnification agreements or arrangements with third parties or under insurance policies with respect to such Losses (and no right of subrogation shall accrue to any such third party indemnitor or insurer hereunder) (each such source named in this clause (B) a “Third Party Source”) and (C) an amount equal to any Tax savings or benefits realized or realizable by the Indemnified Party as calculated on a with or without basis. Each Indemnified Party shall use its commercially reasonable efforts to recover all amounts payable from a Third Party Source under any insurance policy or any other Contract prior to seeking indemnification hereunder.
(ii) The Parent Indemnitees shall not be entitled to recover for any Losses pursuant to Section 8.2(a)(i) unless the Loss resulting from such claim or series of related claims equals or exceeds $15,000 (the “Mini-Basket”); provided that this limitation shall not apply with respect to (A) breaches of the Fundamental Representations and any covenants contained herein or (B) the indemnification obligations set forth in Section 8.6 ((A) and (B) collectively, “Special Indemnified Matters”). In addition, the Parent Indemnitees shall not be entitled to recover any Loss pursuant to Section 8.2(a)(i) in excess of the Mini-Basket unless and until the aggregate amount of all Losses (both before and after the relevant Mini-Basket shall have been exceeded) exceeds $390,000.00 (the “Threshold”), after which the Parent Indemnitees shall be entitled to recover all Losses in excess of both the Mini-Basket and the Threshold; provided that the limitations set forth in this Section 8.5(c)(ii) shall not apply with respect to Losses arising out of or resulting from Special Indemnified Matters.
(iii) Notwithstanding anything to the contrary herein, other than with respect to Special Indemnified Matters, in no event shall the Parent Indemnitees be entitled to recover more than the amount of cash and shares of Parent Common Stock then in the Escrow Account; provided that the maximum aggregate liability of each of the Sellers for Losses arising out of or resulting from claims in respect of Special Indemnified Matters (including with respect to claims of Fraud with respect to Special Indemnified Matters) shall be an amount equal to the excess Purchase Price actually received by such Seller hereunder, provided, further however, that Parent Indemnities shall first recover Losses for Special Indemnified Matters from the Escrow Account.
(if anyiv) of (A) The Parent Indemnitees shall not be entitled to recover from the amount theretofore paid by the Indemnifying Party Sellers, collectively, pursuant to this Article VIII more than once in respect of such Damages, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the amount of any indemnity payment under this Agreement, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)same Losses suffered.
(d) No monetary amount will be payable by Purchaser Notwithstanding anything contained herein to any Seller Indemnified Party the contrary, other than with respect to Special Indemnified Matters, after the Closing, on the date that the amount of cash and shares of Parent Common Stock in the Escrow Account is reduced to zero, the Parent Indemnitees shall have no further rights to indemnification under this Agreement.
(e) For purposes of this Article VIII, any inaccuracy in or breach of any claims representation or warranty shall be determined without regard to any materiality, Material Adverse Effect or other similar qualification contained in or otherwise applicable to such representation or warranty.
(f) Notwithstanding anything to the contrary contained herein, upon any Indemnified Party becoming aware of any claim as to which indemnification may be sought by such Indemnified Party pursuant to Section 8.2(ithis Article VIII, such Indemnified Party shall utilize commercially reasonable efforts, consistent with normal practices and policies, to mitigate such Losses, and any Losses to the extent directly resulting from such Indemnified Party’s failure to comply with the foregoing shall be excluded from the Losses recoverable by such Indemnified Party from the Responsible Party hereunder.
(g) No Responsible Party shall be liable for any Losses in respect of any liability or Loss which is contingent unless and until such contingent liability or Loss becomes an actual liability or Loss and is due and payable. No Responsible Party shall be liable to pay any amount in discharge of a claim under this Article VIII unless and until the aggregate amount liability or Loss in respect of Damages actually incurred by which the Seller claim is made has become due and payable.
(h) No Indemnified Parties Party shall have any right to assert any claim against any indemnifying party hereunder (an “Indemnifying Party”) with respect to any Loss, cause of action or other claim to the extent such claims shall exceed on Loss, cause of action or claim is a cumulative basis an amount equal to fifty thousand dollars Loss, cause of action or claim: (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party i) with respect to which such Indemnified Party or any of its affiliates has taken action (or caused to be taken) with the indemnification primary intent of any claims pursuant accelerating the time period in which such matter is asserted or payable in order to Section 8.2(icause a claim to be made prior to the applicable Survival Date; or (ii) after the aggregate amount of Damages actually paid by Purchaser with respect arising from or related to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)Non-Permitted Testing.
Appears in 1 contract
Samples: Merger Agreement (Ennis, Inc.)
Limitations on Indemnification Obligations. (a) REDUCTIONS FOR INSURANCE PROCEEDS AND OTHER RECOVERIES. The amount which that any Party party (an "Indemnifying PartyINDEMNIFYING PARTY") is or may be required to pay to any other Person (an "Indemnified PartyINDEMNITEE") in respect of Damages or other Liability for which indemnification is provided under this Agreement pursuant to Section 9.2 above, shall be reduced (retroactively or prospectively) by any Insurance Proceeds or other amounts actually received (including Insurance Proceeds actually received) recovered from third parties by or on behalf of such Indemnified Party (net of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) Indemnitee in respect of such Damages the related Indemnifiable Losses. The existence of a claim by an Indemnitee for insurance or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts against a third party in respect of Damages for which any Indemnifiable Loss shall not, however, delay any payment pursuant to the indemnification is provided under this Agreement after the full amount of such Damages has been paid provisions contained herein and otherwise determined to be due and owing by an Indemnifying Party or after an Party. Rather the Indemnifying Party has made a partial shall make payment in full of such Damages amount so determined to be due and such Indemnity Reduction Amounts exceed owing by it against an assignment by the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit Indemnitee to the Indemnifying Party of the entire claim of the Indemnitee for such insurance or against such third party. Notwithstanding any other provisions of this Agreement, it is the intention of the parties hereto that no insurer or any other third party shall be (i) entitled to a benefit it would not be entitled to receive in the absence of the foregoing indemnification provisions or (ii) relieved of the responsibility to pay any claims for which it is obligated. If an amount equal to Indemnitee shall have received the excess (if any) of (A) the amount theretofore paid payment required by the this Agreement from an Indemnifying Party in respect of any Indemnifiable Losses and shall subsequently actually receive Insurance Proceeds or other amounts in respect of such DamagesIndemnifiable Losses, less (B) then such Indemnitee shall hold such Insurance Proceeds in trust for the benefit of such Indemnifying Party and shall pay to such Indemnifying Party a sum equal to the amount of such Insurance Proceeds or other amounts actually received, up to the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the aggregate amount of any indemnity payment under this Agreement, payments received from such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Indemnifying Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)Indemnifiable Losses.
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 1 contract
Samples: Acquisition Agreement (Omi Corp)
Limitations on Indemnification Obligations. (a) The amount which any Party party (an "“Indemnifying Party"”) is or may be required to pay to any Person (an "Indemnified Party") Indemnitee in respect of Damages Indemnifiable Losses or other Liability for which indemnification is provided under this Agreement shall be reduced by any amounts actually received (including Insurance Proceeds actually received) by or on behalf of such Indemnified Party Indemnitee (net of increased insurance premiums and charges to the extent related to Damages Indemnifiable Losses and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party Indemnitee in connection with seeking to collect and collecting such amounts) in respect of such Damages Indemnifiable Losses or other Liability (such net amounts are referred to herein as "“Indemnity Reduction Amounts"”). If any Indemnified Party Indemnitee receives any Indemnity Reduction Amounts in respect of Damages an Indemnifiable Loss for which indemnification is provided under this Agreement after the full amount of such Damages Indemnifiable Loss has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages Indemnifiable Loss and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such DamagesIndemnifiable Loss, then the Indemnified Party Indemnitee shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such DamagesIndemnifiable Loss, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the amount of any indemnity payment under this Agreement, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 1 contract
Samples: Contribution and Purchase Agreement (Sycamore Networks Inc)
Limitations on Indemnification Obligations. The rights of Buyer Indemnitees and Seller Indemnitees to indemnification pursuant to the provisions of Section 10.2 are subject to the following limitations:
(a) The amount which In no event shall the aggregate liability of Seller and its Affiliates or Buyer and its Affiliates hereunder exceed the Purchase Price.
(b) Section 10.4 shall not apply to Losses based upon, arising out of, with respect to or by reasons of (i) the fraud or willful misconduct of the other Party or (ii) any inaccuracy in or breach of any Fundamental Representation.
(c) Notwithstanding anything to the contrary, neither Party (an "Indemnifying Party") is will be liable to the other Party or may be required to pay to its Affiliates for any Person (an "Indemnified Party") loss of future revenue, income, or profits or for any punitive damages in respect of Damages or other Liability for which indemnification is provided under connection with this Agreement or any of the Related Agreements; provided, however, that this limitation shall not apply to claims for Losses resulting from or arising out of fraud or willful misconduct on the part of either Party.
(d) Without limiting the effect of any other limitation contained in this Section 10, for purposes of computing the amount of any Losses incurred by an Indemnified Party hereunder, there shall be reduced by deducted an amount equal to the amount of any amounts insurance proceeds, indemnification payments, contribution payments or reimbursements actually received (including Insurance Proceeds actually received) by or on behalf of such Indemnified Party (net of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) in respect of such Damages or other Liability Losses (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement it being agreed that, promptly after the full amount realization of any such Damages has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment reduction of Losses pursuant hereto, such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit reimburse the Responsible Party for such reduction in Losses for which such Indemnified Party was indemnified prior to the Indemnifying Party an amount equal to the excess (if any) realization of (A) the amount theretofore paid by the Indemnifying Party in respect reduction of such Damages, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the amount of any indemnity payment under this Agreement, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000Losses).
(de) No monetary amount will be payable by Purchaser to any Buyer and Seller Indemnified Party shall cooperate with each other with respect to the indemnification of resolving any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties claim or liability with respect to such claims shall exceed on a cumulative basis an amount equal which one Party is obligated to fifty thousand dollars (U.S.$50,000)indemnify the other Party under this Section 10, in which event Purchaser shall be responsible only for including by making commercially reasonable efforts to mitigate the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable Losses, whether by Purchaser to any Seller Indemnified Party with respect to seeking the indemnification benefits of any claims pursuant to Section 8.2(i) after the aggregate amount insurance, indemnity, contribution or other payments or recoveries of Damages actually paid by Purchaser with respect a like nature applicable to such claims Losses or otherwise.
(f) Without limiting the effect of any other limitation contained in this Section 10, the calculation of Losses shall equal on not include losses arising because of a cumulative basis an amount equal to five hundred thousand dollars change after Closing in Legal Requirements or accounting principle.
(U.S.$500,000)g) All materiality qualifications contained in the representations and warranties of the Parties set forth in this Agreement (however they may be phrased and including the term “Material Adverse Effect”) shall be ignored and not given any effect for purposes of determining Losses under this Section 10.
Appears in 1 contract
Samples: Asset Purchase Agreement
Limitations on Indemnification Obligations. (a) Reductions for Insurance Proceeds and Other ------------------------------------------- Recoveries. The amount which that any Party party (an "Indemnifying Party") is or may ---------- be required to pay to any Person person (an "Indemnified PartyIndemnitee") in respect of Damages pursuant to Section 5.1, ----------- Section 5.2 or other Liability for which indemnification is provided under this Agreement Section 5.3 above, as applicable, shall be reduced by ----------- ----------- (retroactively or prospectively)---by any Insurance Proceeds, other amounts actually received (including Insurance Proceeds actually received) recovered from third parties, or amounts recovered pursuant to any Ancillary Agreement, by or on behalf of such Indemnified Party (net of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) Indemnitee in respect of the related Losses. Each of the parties agrees that it shall use its best efforts to collect any such Damages Insurance Proceeds or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts")which it or any of its Subsidiaries may be entitled. If any Indemnified Party receives any Indemnity Reduction Amounts The existence of a claim by an Indemnitee for insurance or against a third party in respect of Damages for which any Loss shall not delay any payment pursuant to the indemnification is provided under this Agreement after the full amount of such Damages has been paid provisions contained herein and otherwise determined to be due and owing by an Indemnifying Party or after an Party; rather, the Indemnifying Party has made a partial shall make payment in full of such Damages amount so determined to be due and such Indemnity Reduction Amounts exceed owing by it against an assignment by the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit Indemnitee to the Indemnifying Party of the entire claim of the Indemnitee for such insurance or against such third party. No insurer or any other third party shall be (i) entitled to a benefit it would not be entitled to receive in the absence of the foregoing indemnification provisions, (ii) relieved of the responsibility to pay any claims for which it is obligated, or (iii) entitled to any subrogation rights with respect to any obligation arising under the foregoing indemnification provisions. If an amount equal to Indemnitee shall have received the excess (if any) of (A) the amount theretofore paid payment required by the this Agreement from an Indemnifying Party in respect of any Loss and shall subsequently actually receive Insurance Proceeds or other amounts in respect of such DamagesLoss, less (B) then such Indemnitee shall hold such Insurance Proceeds or other amounts in trust for the benefit of such Indemnifying Party and promptly shall pay to such Indemnifying Party a sum equal to the amount of such Insurance Proceeds or other amounts actually received, up to the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the aggregate amount of any indemnity payment under this Agreement, payments received from such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Indemnifying Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)Loss.
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 1 contract
Limitations on Indemnification Obligations. The rights of the Parties to indemnification pursuant to the provisions of this Section 7.2 are subject to the following limitations:
(ai) The amount which of any Party (an "Indemnifying Party") is Loss subject to indemnification hereunder or may be required to pay to of any Person (an "Indemnified Party") in respect of Damages or other Liability for which indemnification is provided under this Agreement Action therefor shall be reduced by calculated net of any amounts actually received (including Insurance Proceeds actually received) by or on behalf of such Indemnified Party insurance proceeds (net of increased insurance premiums and charges to the extent related to Damages and costs reasonable attorneys’ fees and expenses (including reasonable legal fees and expensesincurred in collection) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) in respect of such Damages or other Liability collateral sources (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts in respect of Damages for which indemnification is provided under this Agreement after the full amount of such Damages has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such Damages, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the amount contractual indemnities of any indemnity payment under Person which are contained outside of this Agreement), such amount shall be (i) reduced to take into account any net Tax benefit realized received by the Indemnified Party and its Affiliates arising from the incurrence or payment by the on account of such Loss. The Indemnified Party shall use commercially reasonable efforts to seek full recovery under all insurance policies covering any Loss or its Affiliates of any amount in respect of which collateral sources to the same extent as they would if such payment is made and (ii) increased Loss were not subject to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment indemnification hereunder. In determining the amount of any such Tax benefit event that an insurance recovery or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It indemnification payment is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable received by Seller to any Purchaser an Indemnified Party with respect to the indemnification of any claims pursuant Loss for which any such Person has been indemnified hereunder, then a refund equal to Section 8.1(i) until the aggregate amount of Damages actually the recovery or payment (net of reasonable attorneys’ fees and expenses incurred by the Purchaser Indemnified Parties with respect to in collection and taxes payable on such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000amount), in which event Seller shall be responsible only for up to the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will Loss, shall be payable by Seller to any Purchaser Indemnified Party with respect made promptly to the Indemnifying Party. If a Loss has not yet been determined or paid by the Indemnifying Party, such Party’s indemnification obligations in respect of any claims pursuant to Section 8.1(i) after such Loss shall be reduced by the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars the insurance recovery or indemnification payment (U.S.$500,000net of reasonable attorney’s fees and expenses incurred in collection).
(dii) In valuing a Loss, no adjustment shall be made as a result of any multiple, increase factor, or any other premium over fair market value, book or historical value which may have been paid by Purchaser for the Membership Interests whether or not such multiple, increase factor or other premium had been used by Purchaser at the time of, or in connection with, calculating or preparing its bid, its proposed purchase price for the Membership Interests or its final purchase price for the Membership Interests.
(iii) No monetary Party shall be entitled to recover Losses pursuant to Section 7.2(a)(i) or 7.2(b)(i) until the total amount will be payable by Purchaser to any Seller which such Party would recover under Section 7.2(a)(i) or 7.2(b)(i), respectively, exceeds Fifty Thousand Dollars ($50,000.00) (the “Indemnity Threshold”); provided that if the aggregate Losses claimed under Section 7.2(a)(i) or 7.2(b)(i), respectively, exceed the Indemnity Threshold, the Indemnified Party shall be entitled to recover such Losses to the full extent such relate back to and include the first dollar of aggregate Losses so claimed.
(iv) The maximum aggregate amount of indemnifiable Losses that may be recovered from Seller pursuant to Section 7.2(b)(i) and (ii) shall not exceed Thirty Million Dollars ($30,000,000.00). The maximum aggregate amount of indemnifiable Losses that may be recovered from Purchaser pursuant to Sections 7.2(a) shall not exceed Thirty Million Dollars ($30,000,000.00).
(v) Neither Purchaser Indemnitees nor Seller Indemnitees shall be entitled to indemnification for breach of representations or warranties that have expired, except: (a) to the extent of any claims as to which the applicable Indemnifying Party received written notice prior to the expiration of the applicable survival period, such notice to specify the factual basis of any such claim in detail.
(vi) Notwithstanding anything to the contrary in this Agreement, the indemnification provided in this Article VII shall be the sole and exclusive post Closing remedy available to the Seller Indemnitees for any Losses based upon, arising out of or incurred with respect to (i) any breach of any of Purchaser’s representations and warranties contained in Article V, or (ii) any breach or nonperformance by Purchaser of any covenant or obligation to be performed by Purchaser hereunder or under any agreement executed in connection herewith. Notwithstanding anything to the contrary in this Agreement, the indemnification provided in this Article VII shall be the sole and exclusive post Closing remedy available to the Purchaser Indemnitees for any Losses based upon, arising out of or incurred with respect to (i) any breach of the representations and warranties contained in Article III or IV, (ii) any breach or nonperformance by Seller of any claims pursuant covenant or obligation to Section 8.2(ibe performed by Seller hereunder or under any agreement executed in connection herewith, or (iii) until the aggregate amount of Damages actually any Taxes incurred by the Company or the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser attributable to any Seller Indemnified Party with respect full or partial Tax period or transaction effected prior to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)Closing.
Appears in 1 contract
Limitations on Indemnification Obligations. (a) The amount which any Party party (an "Indemnifying Party") is or may be required to pay to any Person (an "Indemnified Party") Indemnitee in respect of Damages Indemnifiable Losses or other Liability for which indemnification is provided under this Agreement shall be reduced by any amounts actually received (including including, without limitation, Insurance Proceeds actually received) by or on behalf of such Indemnified Party Indemnitee (net of increased insurance premiums and charges related directly and solely to the extent related to Damages Indemnifiable Losses and costs and expenses (including including, without limitation, reasonable legal fees and expenses) incurred by such Indemnified Party Indemnitee in connection with seeking to collect and collecting such amounts) in respect of such Damages Indemnifiable Losses or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party Indemnitee receives any Indemnity Reduction Amounts in respect of Damages an Indemnifiable Loss for which indemnification is provided under this Agreement after the full amount of such Damages Indemnifiable Loss has been paid by an Indemnifying Party or after an Indemnifying Party has made a partial payment of such Damages Indemnifiable Loss and such Indemnity Reduction Amounts exceed exceeds the remaining unpaid balance of such DamagesIndemnifiable Loss, then the Indemnified Party Indemnitee shall promptly remit to the Indemnifying Party an amount equal to the excess (if any) of (A) the amount theretofore paid by the Indemnifying Party in respect of such DamagesIndemnifiable Loss, less (B) the amount of the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made. An insurer or other third party who would otherwise be obligated to pay any claim shall not be relieved of the responsibility with respect thereto or, solely by virtue of the indemnification provisions hereof, have any subrogation rights with respect thereto, it being expressly understood and agreed that no insurer or any other third party shall be entitled to any benefit they would not be entitled to receive in the absence of the indemnification provisions by virtue of the indemnification provisions hereof.
(b) In determining the amount of any indemnity payment under this AgreementIndemnifiable Losses, such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Party and its Affiliates Indemnitee arising from the incurrence or payment by the Indemnified Party or its Affiliates Indemnitee of any amount in respect of which such payment is made Indemnifiable Losses and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates Indemnitee as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates Indemnitee as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effectIndemnifiable Losses. It is the intention of the Parties parties to this Agreement that indemnity payments made pursuant to this Agreement are to be treated as relating back to the Closing Date Distribution as a purchase price adjustmentan adjustment to capital (i.e., capital contribution or distribution), and the Parties parties shall not take any position inconsistent with such intention before any Tax authorityAuthority (as defined in the Tax Allocation Agreement), except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 1 contract
Limitations on Indemnification Obligations. (a) Reductions for Insurance Proceeds and Other Recoveries. The amount which that any Party party (an "Indemnifying Party") is or may be required to pay to any other Person (an "Indemnified PartyIndemnitee") in respect of Damages pursuant to Section 7.01 or other Liability for which indemnification is provided under this Agreement Section 7.02 above, as applicable, shall be reduced (retroactively or prospectively) by any Insurance Proceeds or other amounts actually received (including Insurance Proceeds actually received) recovered from third parties by or on behalf of such Indemnified Party (net of increased insurance premiums and charges to the extent related to Damages and costs and expenses (including reasonable legal fees and expenses) incurred by such Indemnified Party in connection with seeking to collect and collecting such amounts) Indemnitee in respect of such Damages the related Indemnifiable Losses. The existence of a claim by an Indemnitee for insurance or other Liability (such net amounts are referred to herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity Reduction Amounts against a third party in respect of Damages for which any Indemnifiable Loss shall not, however, delay any payment pursuant to the indemnification is provided under this Agreement after the full amount of such Damages has been paid provisions contained herein and otherwise determined to be due and owing by an Indemnifying Party or after an Party. Rather the Indemnifying Party has made a partial shall make payment in full of such Damages amount so determined to be due and such Indemnity Reduction Amounts exceed owing by it against an assignment by the remaining unpaid balance of such Damages, then the Indemnified Party shall promptly remit Indemnitee to the Indemnifying Party of the entire claim of the Indemnitee for such insurance or against such third party. Notwithstanding any other provisions of this Agreement, it is the intention of the parties hereto that no insurer or any other third party shall be (i) entitled to a benefit it would not be entitled to receive in the absence of the foregoing indemnification provisions or (ii) relieved of the responsibility to pay any claims for which it is obligated. If an amount equal to Indemnitee shall have received the excess (if any) of (A) the amount theretofore paid payment required by the this Agreement from an Indemnifying Party in respect of any Indemnifiable Losses and shall subsequently actually receive Insurance Proceeds or other amounts in respect of such DamagesIndemnifiable Losses, less (B) then such Indemnitee shall hold such Insurance Proceeds in trust for the benefit of such Indemnifying Party and shall pay to such Indemnifying Party a sum equal to the amount of such Insurance Proceeds or other amounts actually received, up to the indemnity payment that would have been due if such Indemnity Reduction Amounts in respect thereof had been received before the indemnity payment was made.
(b) In determining the aggregate amount of any indemnity payment under this Agreement, payments received from such amount shall be (i) reduced to take into account any net Tax benefit realized by the Indemnified Indemnifying Party and its Affiliates arising from the incurrence or payment by the Indemnified Party or its Affiliates of any amount in respect of which such payment is made and (ii) increased to take into account any net Tax cost incurred by the Indemnified Party and its Affiliates as a result of the receipt or accrual of payments hereunder (grossed-up for such increase), in each case determined by treating the Indemnified Party and its Affiliates as recognizing all other items of income, gain, loss, deduction or credit before recognizing any item arising from the receipt of accrual of any payment hereunder. In determining the amount of any such Tax benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to be subject to the applicable Taxes at the maximum statutory rate then in effect. It is the intention of the Parties to this Agreement that payments made pursuant to this Agreement are to be treated as relating back to the Closing Date as a purchase price adjustment, and the Parties shall not take any position inconsistent with such intention before any Tax authority, except to the extent that a final determination (as defined in Section 1313 of the Code) with respect to the recipient party causes any such payment not to be so treated.
(c) No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) until the aggregate amount of Damages actually incurred by the Purchaser Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Seller shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Seller to any Purchaser Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.1(i) after the aggregate amount of Damages actually paid by Seller with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000)Indemnifiable Losses.
(d) No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) until the aggregate amount of Damages actually incurred by the Seller Indemnified Parties with respect to such claims shall exceed on a cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in which event Purchaser shall be responsible only for the amount of such Damages in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be payable by Purchaser to any Seller Indemnified Party with respect to the indemnification of any claims pursuant to Section 8.2(i) after the aggregate amount of Damages actually paid by Purchaser with respect to such claims shall equal on a cumulative basis an amount equal to five hundred thousand dollars (U.S.$500,000).
Appears in 1 contract
Samples: Distribution Agreement (Omi Corp)