Common use of Procedures; No Waiver Clause in Contracts

Procedures; No Waiver. (a) The party seeking indemnification under Section 11.02 (the "Indemnified Party") agrees to give prompt notice to the party against whom indemnity is sought (the "Indemnifying Party") of the assertion of any claim, or the commencement of any suit, action or proceeding in respect of which indemnity may be sought under such Section. No indemnification provided for in Section 11.02 shall be available to any party who shall fail to give the notice if the party to whom such notice was not given was unaware of the action, suit or proceeding to which the notice would have related and was prejudiced by the failure to give the notice, but the omission so to notify such Indemnifying Party of any such notification shall not relieve such Indemnifying Party from any liability which it may have to the Indemnified Party otherwise than under this Article XI. If any such claim or action shall be brought against an Indemnified Party, and it shall notify the Indemnifying Party thereof, the Indemnifying Party may, or if the Indemnified Party requests shall, participate therein and, assume the defense thereof with counsel reasonably satisfactory to the Indemnified Party. After notice from the Indemnifying Party to the Indemnified Party of its election to assume the defense of such claim or action, the Indemnifying Party shall not be liable to the Indemnified Party under this Article XI for any legal or other expenses subsequently incurred by the Indemnified Party in connection with the defense thereof; provided, however, if the defendants in any such action include both an Indemnified Party and the Indemnifying Party and the Indemnified Party shall --------------- [CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE COMMISSION PURSUANT TO RULE 24b-2. - 35 - 40 have reasonably concluded that there may be legal defenses available to it and for other Indemnified Parties that are different from or additional to those available to the Indemnifying Party, the Indemnified Party or Parties under this Section 11.03 shall have the right to employ not more than one counsel to represent them and, in that event, the reasonable fees and expenses of not more than one such separate counsel shall be paid by the Indemnifying Party. The Indemnifying Party shall not be liable for any settlement effected without its consent of any claim, litigation or proceeding in respect of which indemnity may be sought hereunder.

Appears in 1 contract

Samples: Stock Purchase Agreement (Gulf South Medical Supply Inc)

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Procedures; No Waiver. The respective rights and obligations of the --------------------- parties and the other indemnitees under this Article IX shall be subject to the following terms and conditions: (a) The party Any Person seeking indemnification under Section 11.02 pursuant to this Article IX (the an "Indemnified Party") agrees to give prompt notice to the party against whom indemnity indemnification is sought (the an "Indemnifying Party") ), of the assertion of any claim, or the commencement of any suit, action or proceeding in respect of which indemnity may be sought under this Agreement ("Claim Notice"). The Claim Notice ------------ shall include: (i) a good faith estimate of the reasonably foreseeable amount of the claimed Losses; and (ii) a reasonably detailed description of the facts, circumstances or events giving rise to the claimed Losses. In the event of any suit, action or proceeding, the Indemnified Party shall give the Claim Notice, together with a copy of such Sectionclaim, process or other legal pleading, to the Indemnifying Party within fourteen (14) days (or such earlier time as might be required to avoid prejudicing the Indemnifying Party's position) after receipt of notice of commencement of such suit, action or proceeding. No indemnification provided for in Section 11.02 shall be available to any party who shall fail Failure of the Indemnified Party to give the notice if the party to whom such notice was will not given was unaware of reduce or relieve the action, suit or proceeding to which the notice would have related and was prejudiced by the failure to give the notice, but the omission so to notify such Indemnifying Party of any such notification shall not relieve such liability hereunder unless and to the extent that the Indemnifying Party was precluded from any liability which it may have to or prejudiced in defending such suit, action or proceeding as a result of the failure of the Indemnified Party otherwise than under this Article XI. If any such claim or action shall be brought against an Indemnified Party, and it shall notify to give timely notice. (b) Within fifteen (15) business days of receipt of the Indemnifying Party thereof, the Indemnifying Party may, or if the Indemnified Party requests shall, participate therein and, assume the defense thereof with counsel reasonably satisfactory to the Indemnified Party. After notice from the Indemnifying Party to the Indemnified Party of its election to assume the defense of such claim or actionClaim Notice, the Indemnifying Party shall not be liable deliver written notice to the Indemnified Party under this Article XI Party, accepting or challenging all or part of the claimed Losses (the "Response -------- Notice"), which shall include reasonable detail on the grounds for any legal or other expenses subsequently incurred by the Indemnified Party in connection with the defense thereof; provided, however, if the defendants in any such action include both an Indemnified Party and denial ------ contained therein. The failure of the Indemnifying Party and to deliver a Response Notice within such time shall constitute a complete acceptance of the Indemnified Party shall --------------- [CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTEDclaimed Losses. ALL SUCH OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE COMMISSION PURSUANT TO RULE 24b-2. - 35 - 40 have reasonably concluded that there may be legal defenses available to it and for other Indemnified Parties that are different from In the event the Response Notice contains a complete or additional to those available to partial denial of the Indemnifying Partyclaimed Losses, the Indemnified Party or Parties under this Section 11.03 either party shall have the right to employ not more than one counsel commence arbitration procedures upon notice delivered to represent them and, in that event, the reasonable fees and expenses of not more than one such separate counsel other (the "Arbitration Notice"). The ------------------ party commencing arbitration shall be paid by referred to herein as the Indemnifying "Initiating ---------- Party. The Indemnifying Party ," and the party receiving such notice shall not be liable for any settlement effected without its consent of any claim, litigation or proceeding in respect of which indemnity may be sought hereunder.referred to herein as the ----- "

Appears in 1 contract

Samples: Merger Agreement (DTVN Holdings Inc)

Procedures; No Waiver. (a) The All claims for indemnification by an Indemnified Person pursuant to this Article IX shall be made in accordance with the provisions of this Section 9.03. (b) A party seeking entitled to indemnification under Section 11.02 this Article IX (the "Indemnified PartyPerson") agrees to shall give prompt notice written notification to the party against whom indemnity is sought Person obligated to provide such indemnification (the "Indemnifying PartyPerson") of the assertion of any claim, or the commencement of any suit, action or proceeding in respect of which indemnity may be sought under such Section. No indemnification provided for in Section 11.02 shall be available to any party who shall fail to give the notice if the party to whom such notice was not given was unaware of the action, suit or proceeding relating to a claim between the parties or a third party claim for which indemnification pursuant to this Article IX may be sought; provided, however, that no delay on the notice would have related and was prejudiced by part of the failure to give Indemnified Person in notifying the notice, but Indemnifying Person shall relieve the omission so to notify such Indemnifying Party of any such notification shall not relieve such Indemnifying Party Person from any liability which it may have or obligation under this Article IX except to the extent of any damage or liability caused solely by or arising solely out of such delay. With respect to any claim by a third party, within 20 days after delivery of such notification, the Indemnifying Person may, upon written notice thereof to the Indemnified Party otherwise than under this Article XI. If any such claim or action shall be brought against an Indemnified Party, and it shall notify the Indemnifying Party thereof, the Indemnifying Party may, or if the Indemnified Party requests shall, participate therein andPerson, assume control of the defense thereof of such action, suit or proceeding with counsel reasonably satisfactory to the Indemnified Party. After notice from Person; provided that (i) the Indemnifying Party Person acknowledges in writing to the Indemnified Party of its election Person that the Indemnifying Person shall indemnify the Indemnified Person with respect to assume the defense all elements of such claim or action, the Indemnifying Party shall not suit or proceeding and any damages, fines, costs or other liabilities that may be liable to assessed against the Indemnified Party under this Article XI for any legal or other expenses subsequently incurred by the Indemnified Party Person in connection with such action, suit or proceeding, and (ii) the third party seeks monetary damages only. If the Indemnifying Person does not so assume control of such defense, the Indemnified Person shall control such defense. The party not controlling such defense thereofmay participate therein at its own expense; provided, however, provided that if the defendants in any Indemnifying Person assumes control of such action include both an Indemnified Party and the Indemnifying Party defense and the Indemnified Party shall --------------- [CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE COMMISSION PURSUANT TO RULE 24b-2. - 35 - 40 Person is advised by counsel in writing that the Indemnifying Person and the Indemnified Person may have reasonably concluded that there may be legal conflicting interests or different defenses available with respect to it and for other Indemnified Parties that are different from such action, suit or additional to those available to the Indemnifying Party, the Indemnified Party or Parties under this Section 11.03 shall have the right to employ not more than one counsel to represent them and, in that eventproceeding, the reasonable fees and expenses of not more than one such separate a single counsel per applicable jurisdiction to the Indemnified Person shall be considered "Losses" for purposes of this Agreement and shall be paid by the Indemnifying Party. The party controlling such defense shall keep the other party advised of the status of such action, suit or proceeding and the defense thereof and shall consider in good faith recommendations made by the other party with respect thereto. An Indemnified Person shall not agree to any settlement of such action, suit or proceeding without the prior written consent of the Indemnifying Party Person, which shall not be liable for unreasonably withheld or delayed. The Indemnifying Person shall not agree to any settlement effected or the entry of a judgment in any action, suit or proceeding without its the prior written consent of the Indemnified Person, which shall not be unreasonably withheld (it being understood that it is reasonable to withhold such consent if, among other things, the settlement or the entry of a judgment (A) lacks a complete release of the Indemnified Person for all liability with respect thereto or (B) imposes any claim, litigation liability or proceeding in respect of which indemnity may be sought hereunderobligation on the Indemnified Person).

Appears in 1 contract

Samples: Asset Purchase Agreement (Screaming Media Com Inc)

Procedures; No Waiver. (a) The party seeking indemnification under Section 11.02 10.02 (the "Indemnified Party") agrees to give prompt notice (the “Notice of Claim”) to the party Party against whom indemnity is sought (the "Indemnifying Party") upon becoming aware of the assertion of any claim, or the commencement of any suit, action or proceeding in respect of which indemnity may be sought under such SectionSection 10.02. No The Notice of Claim shall request indemnification provided and specify the basis on which indemnification is sought, indicate the amount of the Indemnified Party’s claim for in Section 11.02 shall be available to any party who shall fail to indemnification (or, if such amount is not then determined, a good faith estimate thereof), give a general description of the notice if nature of the party to whom such notice was not given was unaware of claim, demand or facts that serve as a basis therefore, indicate a reasonably approximate date the action, suit event or proceeding circumstance giving rise to which the notice would claim first arose (or, if not known to the Indemnified Party, the date the Indemnified Party became aware of the action or event), and in the case of a third party claim, containing (by attachment or otherwise) such other information as the Indemnified Party shall have related and was prejudiced by concerning such third party claim. The delay or failure of the failure to give the notice, but the omission so Indemnified Party to notify the Indemnifying Party of such claim shall not relieve the Indemnifying Party of any such notification shall not relieve such Indemnifying Party from any liability which it may have to the Indemnified Party otherwise than under this Article XI. If any such claim or action shall be brought against an Indemnified Party, and it shall notify that the Indemnifying Party thereof, may have with respect to such claim except to the extent that the Indemnifying Party may, or if the Indemnified Party requests shall, participate therein and, assume the defense thereof with counsel reasonably satisfactory to the Indemnified Party. After notice from the Indemnifying Party to the Indemnified Party of its election to assume demonstrates that the defense of such claim is materially prejudiced by such delay or actionfailure. (b) If the indemnification involves a third party claim, the procedures set forth in Section 10.04 hereof shall be observed by the Indemnified and Indemnifying Parties. If the indemnification involves a claim and the Indemnified Parties are seeking recovery from the Escrow, the procedures set forth in Section 2.06 shall be observed by the Indemnified and Indemnifying Parties (c) If the Notice of Claim delivered pursuant to Section 10.03(a) involves a matter other than a third party claim, the Indemnifying Party shall not be liable have fifteen (15) Business Days to object to such Notice of Claim by delivery of a written notice of such objection to the Indemnified Party under this Article XI specifying in reasonable detail the basis for any legal or other expenses subsequently incurred such objection. Failure to timely so object shall constitute a final and binding acceptance of the Notice of Claim by the Indemnifying Party. If an objection is timely interposed by the Indemnifying Party, then the Indemnifying Party and Indemnified Party shall negotiate in good faith for a period of forty-five (45) Business Days from the date the Indemnified Party in connection receives such objection prior to commencing or defending any proceeding with respect to such Notice of Claim. (d) Upon determination of the defense thereof; provided, however, if the defendants in any such action include amount of a Notice of Claim that is binding on both an Indemnified Party and the Indemnifying Party and the Indemnified Party shall --------------- [CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE COMMISSION PURSUANT TO RULE 24b-2. - 35 - 40 have reasonably concluded that there may be legal defenses available pursuant to it and for other Indemnified Parties that are different from subsection (c) above, or additional to those available pursuant to the Indemnifying Partywritten agreement of the Parties, or pursuant to a final judgment obtained by an Indemnified Party with respect thereto, the Indemnified Party or Parties under this Section 11.03 shall have the right to employ not more than one counsel to represent them and, in that event, the reasonable fees and expenses amount of not more than one such separate counsel Notice of Claim shall be paid by the Indemnifying Party. The Party (or the Escrow Agent if Seller is the Indemnifying Party shall not be liable for any settlement effected without its consent of any claim, litigation and the Escrow Agreement is still in effect and there are Buyer Shares in escrow) no later than five (5) Business Days after the date such amount is determined or proceeding in respect of which indemnity may be sought hereunderagreed.

Appears in 1 contract

Samples: Stock Purchase Agreement (World Surveillance Group Inc.)

Procedures; No Waiver. (a) The All claims for indemnification by an Indemnified Person pursuant to this Section 9 shall be made in accordance with the provisions of this Section 9.3. (b) A party seeking entitled to indemnification under this Section 11.02 9 (the "Indemnified PartyPerson") agrees to shall give prompt notice written notification to the party against whom indemnity is sought Person obligated to provide such indemnification (the "Indemnifying PartyPerson") of the assertion of any claim, or the commencement of any suit, action or proceeding in respect of which indemnity may be sought under such Section. No indemnification provided for in Section 11.02 shall be available to any party who shall fail to give the notice if the party to whom such notice was not given was unaware of the action, suit or proceeding relating to a claim between the parties or a third-party claim for which indemnification pursuant to this Section 9 may be sought describing the notice would have related claim in reasonable detail and was prejudiced by the failure to give the notice, but the omission so to notify such Indemnifying Party furnishing copies of any court papers or other documents received in connection with such notification claim; provided, however, that no delay on the part of the Indemnified Person in notifying the Indemnifying Person shall not relieve such the Indemnifying Party Person from any liability which it may have or obligation under this Section 9 except to the extent of any damage or liability caused solely by or arising solely out of such delay. With respect to any claim by a third-party, within 20 days after delivery of such notification, the Indemnifying Person may, upon written notice thereof to the Indemnified Party otherwise than under this Article XI. If any such claim or action shall be brought against an Indemnified Party, and it shall notify the Indemnifying Party thereof, the Indemnifying Party may, or if the Indemnified Party requests shall, participate therein andPerson, assume control of the defense thereof of such action, suit or proceeding with counsel reasonably satisfactory to the Indemnified PartyPerson. After notice from The Indemnified Person may participate in such defense with counsel of its choice, but the fees and expenses of such counsel shall be at the expense of the Indemnified Person unless: (i) the Indemnifying Party to the Indemnified Party of its election Person shall have failed to assume the defense of such claim or action, (ii) the Indemnifying Party shall not be liable Person fails to provide the Indemnified Party under this Article XI for any legal Person with reasonable evidence that the Indemnifying Person will have the financial resources to defend against the third-party claim and fulfill its indemnification obligations hereunder, or other expenses subsequently incurred by the Indemnified Party in connection with the defense thereof; provided, however, (iii) if the defendants in named parties to any such action or proceeding include both an the Indemnified Party Person and the Indemnifying Party Person and the Indemnified Party Person shall --------------- [CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE COMMISSION PURSUANT TO RULE 24b-2. - 35 - 40 have reasonably concluded been advised by counsel that there may be one or more legal defenses available to it and for other such Indemnified Parties Person that are different from or additional in addition to those available to the Indemnifying Party, the Indemnified Party or Parties under this Section 11.03 shall have the right to employ not more than one counsel to represent them and, in that Person. In any event, the reasonable fees and expenses of not more than one such separate counsel shall be paid by the Indemnifying Party. The Indemnifying Party Person shall not be liable for fees and expenses of more than one counsel. The party controlling a defense shall keep the other party advised of the status of such action, suit or proceeding and the defense thereof and shall consider in good faith recommendations made by the other party with respect thereto. The Indemnified Person will not consent to the entry of any judgment or enter into any settlement effected with respect to the third-party claim without its the prior written consent of the Indemnifying Person (not to be unreasonably withheld, delayed or conditioned) unless (i) the Indemnifying Person fails to assume the defense of such third-party claim or (ii) such consent or settlement includes the unconditional release of the Indemnifying Person from all liability arising out of such third-party claim (including any liability of the Indemnifying Person hereto with respect to such third-party claim). The Indemnifying Person will not consent to the entry of any judgment or enter into any settlement with respect to the third-party claim without the prior written consent of the Indemnified Person (not to be unreasonably withheld, delayed or conditioned) unless such consent of settlement (i) includes an unconditional release of the Indemnified Person from all liability arising out of such third-party claim, litigation (ii) does not contain any admission of liability on behalf of the Indemnified Person, and (iii) does not contain any equitable order, judgment or proceeding in respect term which restrains or interferes with the business of which indemnity may be sought hereunderthe Indemnified Person.

Appears in 1 contract

Samples: Securities Purchase Agreement (Rare Medium Group Inc)

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Procedures; No Waiver. (a) The party seeking indemnification under Section 11.02 10.02 (the "Indemnified Party") agrees to give prompt notice (the “Notice of Claim”) to the party Party against whom indemnity is sought (the "Indemnifying Party") upon becoming aware of the assertion of any claim, or the commencement of any suit, action or proceeding in respect of which indemnity may be sought under such SectionSection 10.02. No The Notice of Claim shall request indemnification provided and specify the basis on which indemnification is sought, indicate the amount of the Indemnified Party’s claim for in Section 11.02 shall be available to any party who shall fail to indemnification (or, if such amount is not then determined, a good faith estimate thereof), give a general description of the notice if nature of the party to whom such notice was not given was unaware of claim, demand or facts that serve as a basis therefore, indicate a reasonably approximate date the action, suit event or proceeding circumstance giving rise to which the notice would claim first arose (or, if not known to the Indemnified Party, the date the Indemnified Party became aware of the action or event), and in the case of a third party claim, containing (by attachment or otherwise) such other information as the Indemnified Party shall have related and was prejudiced by concerning such third party claim. The delay or failure of the failure to give the notice, but the omission so Indemnified Party to notify the Indemnifying Party of such claim shall not relieve the Indemnifying Party of any such notification shall not relieve such Indemnifying Party from any liability which it may have to the Indemnified Party otherwise than under this Article XI. If any such claim or action shall be brought against an Indemnified Party, and it shall notify that the Indemnifying Party thereof, may have with respect to such claim except to the extent that the Indemnifying Party may, or if the Indemnified Party requests shall, participate therein and, assume the defense thereof with counsel reasonably satisfactory to the Indemnified Party. After notice from the Indemnifying Party to the Indemnified Party of its election to assume demonstrates that the defense of such claim is materially prejudiced by such delay or actionfailure. (b) If the indemnification involves a third party claim, the procedures set forth in Section 10.04 hereof shall be observed by the Indemnified and Indemnifying Parties. If the indemnification involves a claim and the Indemnified Parties are seeking recovery by reducing an Installment Payment or from the Escrow, the procedures set forth in Section 2.06 shall be observed by the Indemnified and Indemnifying Parties (c) If the Notice of Claim delivered pursuant to Section 10.03(a) involves a matter other than a third party claim, the Indemnifying Party shall not be liable have fifteen (15) Business Days to object to such Notice of Claim by delivery of a written notice of such objection to the Indemnified Party under this Article XI specifying in reasonable detail the basis for any legal or other expenses subsequently incurred such objection. Failure to timely so object shall constitute a final and binding acceptance of the Notice of Claim by the Indemnifying Party. If an objection is timely interposed by the Indemnifying Party, then the Indemnifying Party and Indemnified Party shall negotiate in good faith for a period of forty-five (45) Business Days from the date the Indemnified Party in connection receives such objection prior to commencing or defending any proceeding with respect to such Notice of Claim. (d) Upon determination of the defense thereof; provided, however, if the defendants in any such action include amount of a Notice of Claim that is binding on both an Indemnified Party and the Indemnifying Party and the Indemnified Party shall --------------- [CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE COMMISSION PURSUANT TO RULE 24b-2. - 35 - 40 have reasonably concluded that there may be legal defenses available pursuant to it and for other Indemnified Parties that are different from subsection (c) above, or additional to those available pursuant to the Indemnifying Partywritten agreement of the Parties, or pursuant to a final judgment obtained by an Indemnified Party with respect thereto, the Indemnified Party or Parties under this Section 11.03 shall have the right to employ not more than one counsel to represent them and, in that event, the reasonable fees and expenses amount of not more than one such separate counsel Notice of Claim shall be paid by the Indemnifying Party. The Party (or the Escrow Agent if Seller is the Indemnifying Party shall not be liable for any settlement effected without its consent of any claim, litigation and the Escrow Agreement is still in effect and there are Buyer Shares in escrow or proceeding in respect of which indemnity may be sought hereunderby Buyer reducing an Installment Payment if Seller is the Indemnifying Party) no later than five (5) Business Days after the date such amount is determined or agreed.

Appears in 1 contract

Samples: Stock Purchase Agreement (World Surveillance Group Inc.)

Procedures; No Waiver. (a) The party seeking indemnification under Section 11.02 9.02 (the "Indemnified Party") agrees to give prompt notice to the party against whom indemnity is sought (the "Indemnifying Party") of the assertion of any claim, or the commencement of any suit, action or proceeding in respect of which indemnity may be sought under such Section. No indemnification provided for in Section 11.02 shall be available to any party who shall fail to give the notice if the party to whom such notice was not given was unaware of the action, suit or proceeding to which the notice would have related and was prejudiced by the failure to give the notice, but the omission so to notify such Indemnifying Party of any such notification shall not relieve such Indemnifying Party from any liability which it may have to the Indemnified Party otherwise than under this Article XI. If any such claim or action shall be brought against an Indemnified Party, and it shall notify the Indemnifying Party thereof, the The Indemnifying Party may, or if and at the request of the Indemnified Party requests shall, participate therein and, assume the defense thereof with counsel reasonably satisfactory to the Indemnified Party. After notice from the Indemnifying Party to the Indemnified Party of its election to assume in and control the defense of such claim any third party suit, action or action, the Indemnifying Party shall not be liable to the Indemnified Party under this Article XI for any legal or other expenses subsequently incurred by the Indemnified Party in connection with the defense thereof; provided, however, if the defendants in any such action include both an Indemnified Party and the Indemnifying Party and the Indemnified Party shall --------------- [CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE COMMISSION PURSUANT TO RULE 24b-2. - 35 - 40 have reasonably concluded that there may be legal defenses available to it and for other Indemnified Parties that are different from or additional to those available to the Indemnifying Party, the Indemnified Party or Parties under this Section 11.03 shall have the right to employ not more than one counsel to represent them and, in that event, the reasonable fees and expenses of not more than one such separate counsel shall be paid by the Indemnifying Partyproceeding at its own expense. The Indemnifying Party shall not be liable under Section 9.02 for any settlement effected without its consent of any claim, litigation or proceeding in respect of which indemnity may be sought hereunder. (b) With respect to any OMG Claims, the following special procedures and provisions shall apply in addition to the foregoing: (i) West's and OMG's sole and exclusive remedy for OMG Claims and Damages shall be to adjust downward the number of Earn-Out Shares to be delivered pursuant hereto. (ii) Notwithstanding any provision of this Agreement to the contrary, it is agreed that the OMG Group shall have no right to indemnification unless and until the total Damages relating to either agreed to or finally allowed OMG Claims shall have equalled or exceeded a threshold of $87,500 (exclusive of Damages relating to a breach of the representations and warranties set forth in section 4.25, as to which no threshold limit to a right to indemnity shall apply); provided, however, that for purposes of measuring this threshold, and only for such purpose, all qualifications to any of the representations and warranties contained in Article IV hereof by reference to the word "material" (or any derivative terms, including, without limitation, Material Adverse Effect) shall be deemed to be omitted from such representations and warranties. Once such threshold level has been achieved, however, both the foregoing $87,500 (exclusive of Damages relating to a breach of the representations and warranties set forth in section 4.25, as to which no threshold limit to a right to indemnity shall apply) exclusionary threshold limit, and the elimination of such qualifications shall have no further force and effect. (iii) CSTM and the CSTM Stockholders hereby irrevocably appoint Xxxxx Xxxxx as their authorized representative (herein, in such capacity, the "CSTM Representative") for purposes of binding CSTM and the CSTM Stockholders to the resolution of all OMG claims. Notice of all OMG Claims shall be given to the CSTM Representative as hereinabove provided. West and OMG acknowledge and agree that the CSTM Representative is authorized to act on behalf of CSTM with respect to all matters relating to this Article IX. (iv) After the giving of notice of any OMG Claim, the CSTM Representative and the OMG Group shall cooperate with each other to exchange such information as may be necessary or desirable in order to allow the CSTM Representative to evaluate the validity and extent of any such OMG Claim. In the event the OMG Group and the CSTM Representative agree as to the validity of any such OMG Claim and the amount of Damages associated therewith, then the number of Earn-Out Shares to be delivered pursuant to the provisions of Section 2.02.D.(iv), above, shall be reduced in accordance with the provisions of such section by the amount of such Damages; provided that no such adjustment shall be required unless and until the threshold level described in sub-paragraph (ii), above, has been exceeded. (v) In the event of a dispute between the CSTM Representative and the OMG Group as to the validity of one or more OMG Claims or the amount of Damages associated therewith, which dispute has not been resolved by the Delivery Date, OMG shall, on or before the first anniversary of the Closing, delivery to Xxxxxxx X. Xxxx, Esquire (herein, the "Escrow Agent," to be held by him in escrow, a number of Earn-Out Shares equal to the value designated by OMG of such OMG Claim, calculated as provided in section 2.02.D.(iv) hereinabove, to be held by the Escrow Agent, pending either a future agreement by the CSTM Representative and OMG or issuance of a final and non-appealable order of the Suffolk Superior Court in Boston, Massachusetts. A copy of such notice to the Escrow Agent shall be provided to the CSTM Representative. The parties agree to cooperate to sign such reasonable escrow agreements and instructions as may be requested by the Escrow Agent. The costs of any such escrow arrangement shall be borne by OMG. (vi) With respect to any OMG Claims or the damages associated therewith which are disputed and which cannot be resolved consensually by 36 the parties, the parties agree to cause them to be resolved through arbitration. The parties shall first endeavor to agree on one arbitrator to hear the matter. If such agreement cannot be reached within ten (10) business days following receipt of notice from one party to the other that arbitration is requested, then within ten (10) business days thereafter, the parties shall designate to the other the name of an arbitrator located within the six (6) New England states and having reasonable experience in the industry or the issue which is the subject matter of the dispute. The two arbitrators shall then meet to agree upon a third arbitrator within twenty (20) business days of their appointment, and if no such agreement can be reached, then any party hereto may petition the Superior Court for Suffolk County in Boston, Massachusetts to appoint a third arbitrator. Within twenty (20) business days following the appointment of all three arbitrators, the arbitrators shall call a pre-trial meeting among the parties and their representatives to establish a briefing schedule and trial procedure. Such meeting and all evidentiary hearings shall be held at a place convenient to the arbitrators but located in Boston, Massachusetts. The arbitrators may determine such rules of evidence as they may wish to apply or not apply in conducting such hearings. After reviewing the submissions of the parties and hearing any evidence which the parties deem appropriate, the arbitrators shall render a decision as soon as practicable, which may be filed in the Superior Court of Suffolk County and an action for the entry of an award with respect thereto be maintained by any party. (vii) The costs and expenses of the arbitration shall be shared equally by the parties, unless the arbitrators shall have determined that all or a substantial portion of the position of one of the parties was frivolous, wholly unsubstantial, advanced in bad faith or advanced for the purposes of delay or harassment, in which case all costs of the arbitration shall be borne by the losing party and the prevailing party shall be entitled to receive all of its costs and expenses, including reasonable counsel fees and reasonable fees of any experts, from the losing party. (viii) If the parties are able consensually to resolve such dispute then they shall jointly give notice to the Escrow Agent as to the number of Earn-Out Shares to be distributed to the CSTM Stockholders and the number of CSTM Shares to be returned to OMG, and he shall be obligated promptly to comply with such joint instruction. Alternatively, if the matter has been resolved by a final and non-appealable order of the Suffolk Superior Court, then either party may give notice to the Escrow Agent of such decision, and such Escrow Agent shall thereupon calculate the number of Earn-Out Shares to be distributed to the CSTM Stockholders and to be returned to OMG in accordance with such order and the provisions of this Agreement, and the Escrow Agent shall then give notice thereof to the CSTM Representative and to OMG. Ten days after such notice, the Escrow Agent shall then distribute such Earn-Out Shares in accordance with his notice, unless the Escrow Agent shall have received notice prior to such time as to any error or mistake in his calculation, in which case the Escrow Agent shall, if he believes such position to have been accurate, in whole or in part, he shall reissue such ten day notice. All parties shall be conclusively barred from bringing any claim against the Escrow Agent for miscalculation of the amount of Earn-Out Shares to be delivered unless the Escrow Agent shall have received notice from such party of any such claim as herein provided. In the event the Escrow Agent is unable to resolve competing claims of the parties, the Escrow Agent shall submit the matter for determination by the Suffolk Superior Court in Boston, Massachusetts, whose final and non-appealable determination shall be binding on all parties. The Escrow Agent shall also have such additional time to make delivery of the Earn-Out Shares as may be necessary in order for him properly to hypothecate the certificate or certificates escrowed with him to those who are entitled to portions thereof. Notwithstanding anything in this section to the contrary, however, in the event there is a dispute as to more than one OMG Claim remaining unresolved after the Delivery Date, then the Escrow Agent shall not be required to distribute any Earn-Out Shares relating from a resolved or finally determined dispute unless and until the Escrow Agent shall be satisfied that the amount of Earn-Out Shares remaining with him after the resolution of such dispute shall be sufficient in amount to cover OMG Claims for Damages for all disputes which still remain unresolved or not finally determined.

Appears in 1 contract

Samples: Merger Agreement (Omni Multimedia Group Inc)

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