Satisfaction of Claims. (a) Claims made by the Buyer Indemnified Persons for indemnification under this Section 8 (other than claims made under clause (iv) or (v) of Section 8.2(a)) shall be satisfied (x) directly from Compass for Compass’ Pro Rata Percentage of such claim and (y) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount, and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claim. In the event of a Breach by a particular Seller under Section 8.2(b), indemnification for such Breach will be satisfied solely by such Seller (including from such Seller’s Pro Rata Percentage of the Non-Public Stockholder Indemnification Escrow Amount). (b) Claims made by the Buyer Indemnified Persons for indemnification under clause (iv) or (v) of Section 8.2(a) shall be satisfied first from the Litigation Escrow Amount and, if the Litigation Escrow Amount is insufficient to satisfy such claim for indemnification, then, (x) directly from Compass for Compass’ Pro Rata Percentage of such claim and (y) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claim. (c) Claims made by the Buyer Indemnified Persons for indemnification under Section 6.2(d) shall be governed by such section.
Appears in 2 contracts
Samples: Stock Purchase Agreement, Stock Purchase Agreement (Compass Diversified Holdings)
Satisfaction of Claims. The obligation of the Stockholder Parties to pay Final Losses shall be satisfied as follows or any other claims under this ARTICLE X:
(a) Claims made First, if any portion of the Second Tranche of Escrowed Cash and Second Tranche of Escrowed Shares have not been distributed to the Company Stockholders:
(i) the Purchaser shall be paid, out of the then-remaining Second Tranche of Escrowed Cash, an amount (the “Cash Portion of Final Loss”) equal to the Final Loss multiplied by the Buyer Indemnified Persons for indemnification under this Section 8 (other than claims made under clause (iv) or (v) Cash Election Percentage, and such amount of Section 8.2(a)) the Second Tranche of Escrowed Cash shall be satisfied deemed to have been fully and forever forfeited by the Company Stockholders; and
(ii) the Company Stockholders shall be deemed to have fully and forever forfeited the right to receive a number of the then-remaining Second Tranche of Escrowed Shares (the “Stock Portion of Final Loss”) equal to (x) directly from Compass for Compass’ Pro Rata the amount of the Final Loss multiplied by the Stock Election Percentage of such claim and divided by (y) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount, and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claim. In the event of a Breach by a particular Seller under Section 8.2(b), indemnification for such Breach will be satisfied solely by such Seller (including from such Seller’s Pro Rata Percentage of the Non-Public Stockholder Indemnification Escrow Amount)Share Value.
(b) Claims Second, if any amount of the Final Loss remains unsatisfied after the application of Escrowed Cash and Escrowed Shares pursuant to Section 10.6(a), subject to the limitations contained in this ARTICLE X, the Company Stockholders shall be jointly and severally liable for paying such unsatisfied portion of the Final Loss to Purchaser, with such payments being made in cash, or, at the election of any Company Stockholder, a combination of cash and Series AA Stock (valued for purposes of satisfying the Final Loss at the Share Value); provided that the maximum number of Series AA Stock a Company Stockholder may elect to transfer to Purchaser in satisfaction of the Final Loss may not exceed the number of shares of Series AA Stock as equals the product of (i) the unsatisfied portion of the Final Loss being paid by such Company Stockholder divided by the Buyer Indemnified Persons for indemnification under clause Share Value (ivii) or (v) multiplied by a fraction of Section 8.2(a) shall be satisfied first from the Litigation Escrow Amount and, if numerator of which is the Litigation Escrow Amount is insufficient to satisfy number of Stock Election Shares held by such claim for indemnification, then, (x) directly from Compass for Compass’ Pro Rata Percentage of such claim and (y) with respect to Sellers other than Compass, from Company Stockholder on the Non-Public Stockholder Indemnification Escrow Amount and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claim.
(c) Claims made Closing Date divided by the Buyer Indemnified Persons for indemnification under Section 6.2(d) shall be governed total number of Company Common Shares held by such sectionthe Company Stockholder on the Closing Date.
Appears in 2 contracts
Samples: Merger Agreement (Metastorm Inc), Stock Purchase Agreement (Metastorm Inc)
Satisfaction of Claims. (ai) Claims made All claims for indemnification by the Buyer Parent Indemnified Persons for indemnification Parties under this Section 8 (other than claims made under clause (iv) or (v) of Section 8.2(a)) shall be satisfied (x) directly from Compass for Compass’ Pro Rata Percentage of such claim and (y) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount, and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claim. In the event of a Breach by a particular Seller under Section 8.2(b), indemnification for such Breach will be satisfied solely by such Seller (including from such Seller’s Pro Rata Percentage of the Non-Public Stockholder Indemnification Escrow Amount).
(b) Claims made by the Buyer Indemnified Persons for indemnification under clause (iv) or (v) of Section 8.2(a) Article X shall be satisfied first via payment from the Litigation Escrow Amount andFund in accordance with Section 10.3. If a Parent Indemnified Party is entitled to recover a Loss pursuant to this Article X, if and either (i) the Litigation amount of Losses claimed by Parent Indemnified Parties in Officer Certificates exceeds the amount remaining in the Escrow Amount is insufficient Fund, or (ii) the Escrow Fund has been distributed to satisfy such claim for indemnificationStockholders following the Expiration Date, then, (x) directly from Compass for Compass’ Pro Rata Percentage of such claim and (y) with respect subject to Sellers other than Compassthe limitations set forth in this Article X, from the Non-Public each Stockholder Indemnification Escrow Amount and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnificationshall be severally, then directly from Sellers (other than Compass), severally and not jointly jointly, liable for such SellerStockholder’s Pro Rata Percentage Portion of such claimLoss, in which case such Stockholder shall make payment directly to such Parent Indemnified Party except to the extent that Parent has set aside amount of an Earnout Payment in respect of such Loss.
(cii) Claims made Subject to the limitations set forth in Section 10.5, If Parent shall deliver an Officer’s Certificate specifying Losses in excess of the then available Escrow Fund (such Losses, the “Excess Losses”), Parent may set aside an amount equal to such Excess Losses from any unpaid Earnout Payment until the final resolution of the claims set forth in such Officer’s Certificate in accordance with this Article X. Upon such final resolution, Parent shall be entitled, in its sole discretion, to satisfy any such Excess Losses to which an Indemnified Party is entitled out of such retained amount (and any amount in excess of such Losses, if any, shall be paid to the Stockholders in accordance with this Agreement), with any Earnout Payment that has been earned being reduced by the Buyer amount of such Losses; provided that Parent may not reduce future Earnout Payments for such Excess Losses unless and until the amount of Losses claimed by Indemnified Persons for indemnification under Section 6.2(d) shall be governed by such sectionParties in Officer Certificates exceeds the amount remaining in the Escrow Fund.
Appears in 2 contracts
Satisfaction of Claims. Upon (ai) Claims made mutual agreement by the Buyer Indemnifying Party and Indemnified Persons for Party, or (ii) final determination of an indemnification under claim in accordance with this Section 8 11.5, in either case as to the disposition of an indemnification claim and the amount of Losses in connection therewith, such indemnification obligation shall be satisfied by the Indemnifying Party within fifteen days thereafter. If the Indemnifying Party is the Stockholder Representative, such indemnification obligation shall be satisfied by the Stockholder Representative (i) by executing and delivering to Purchaser joint written instructions to the Escrow Agent for countersignature by Purchaser, instructing the Escrow Agent to release to Purchaser, out of the Escrow Dividends (if any) and the Indemnity Shares Amount, (A) first, the amount of the Escrow Dividends (up to the amount of such indemnified Loss) and (B) second, if the Escrow Dividends are insufficient, the number of shares (the “Indemnification Shares”) equal to the remaining amount of indemnified Losses in respect of such claim divided by the Purchaser Share Price or (ii) by Purchaser’s delivery of a final determination of an indemnification claim in accordance with this Section 11.5 in accordance with the terms of the Escrow Agreement to the Escrow Agent. If the Indemnifying Party is Purchaser, such indemnification obligation shall be satisfied by payment in immediately available funds in the amount of the finally determined Loss to the Exchange Agent, accompanied by a written instruction from Purchaser to the Exchange Agent directing the Exchange Agent to disburse such funds to the Company Stockholders (other than claims made under clause (ivholders of Dissenting Shares) or (v) of Section 8.2(a)) shall be satisfied (x) directly from Compass for Compass’ in accordance with their Pro Rata Percentage Portions as set forth in the Estimated Adjustment Statement, provided that such Company Stockholder has delivered a duly executed Letter of such claim Transmittal to the Exchange Agent and (y) any other required documents in accordance with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount, and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claim. In the event of a Breach by a particular Seller under Section 8.2(b), indemnification for such Breach will be satisfied solely by such Seller (including from such Seller’s Pro Rata Percentage of the Non-Public Stockholder Indemnification Escrow Amount)3.2.
(b) Claims made by the Buyer Indemnified Persons for indemnification under clause (iv) or (v) of Section 8.2(a) shall be satisfied first from the Litigation Escrow Amount and, if the Litigation Escrow Amount is insufficient to satisfy such claim for indemnification, then, (x) directly from Compass for Compass’ Pro Rata Percentage of such claim and (y) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claim.
(c) Claims made by the Buyer Indemnified Persons for indemnification under Section 6.2(d) shall be governed by such section.
Appears in 2 contracts
Samples: Merger Agreement (Zurn Water Solutions Corp), Merger Agreement (Zurn Water Solutions Corp)
Satisfaction of Claims. (a) The Shareholders and DoveBid agree that any Claim for indemnification under Section 8.2(a) may at the election of DoveBid be satisfied by either: (i) retaining any Escrow Shares (as defined under the NLA Purchase Agreement) held under the NLA Purchase Agreement subject to the right of the Shareholders to promptly satisfy such Claims made by paying cash to DoveBid in the full amount of such Claim within twenty (20) days of resolution of such Claim; or (ii) through the payment of cash or other property or assets to DoveBid by the Buyer Indemnified Persons Shareholders. To the extent that DoveBid elects to satisfy any Claim for indemnification under this Article VIII by retaining Escrow Shares and the Shareholders do not timely fully pay such Claim in cash, then such shares shall be valued at a price of $10.50 per share (subject to proportional adjustment for any stock splits, stock combinations, recapitalizations or like events) for purposes of satisfying such Claim regardless of whether the actual market price of DoveBid common stock is higher or lower, and in such event DoveBid shall not have the right to recover any deficiency and the Shareholders will not have the right to recover any excess. Claims for indemnification under Section 8 (other than claims made under clause (iv) or (v) of Section 8.2(a)8.2(b) shall be satisfied (x) directly from Compass for Compass’ Pro Rata Percentage by DoveBid by payment of such claim and (y) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount, and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claim. In the event of a Breach by a particular Seller under Section 8.2(b), indemnification for such Breach will be satisfied solely by such Seller (including from such Seller’s Pro Rata Percentage of the Non-Public Stockholder Indemnification Escrow Amount)cash.
(b) Claims made by the Buyer Indemnified Persons for indemnification by a party under clause this Article VIII must be made in writing prior to the expiration of the Survival Period; provided that if a Notice of Claim is asserted in writing before the expiration of the Survival Period, then (ivnotwithstanding the subsequent expiration of the Survival Period) or the obligation of the Shareholders to indemnify the DoveBid Indemnitees (von the one hand) and the obligation of Section 8.2(a) shall be satisfied first from DoveBid to Indemnify the Litigation Escrow Amount and, if Shareholders (on the Litigation Escrow Amount is insufficient to satisfy such claim for indemnification, then, (x) directly from Compass for Compass’ Pro Rata Percentage of such claim and (yother hand) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount such Claim shall continue until such Claim is finally resolved and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claimsatisfied in full in accordance with this Agreement.
(c) Claims made by the Buyer Indemnified Persons for indemnification under Section 6.2(d) shall be governed by such section.
Appears in 2 contracts
Samples: Stock Purchase Agreement (Dovebid Inc), Stock Purchase Agreement (Dovebid Inc)
Satisfaction of Claims. (a) The Principal Shareholders and DoveBid agree that any Claim for indemnification under Section 8.2(a) may at the election of DoveBid be satisfied by either: (i) retaining Escrow Shares, subject to the right of the Principal Shareholders to promptly satisfy such Claims made by paying cash to DoveBid in the Buyer Indemnified Persons full amount of such Claim within twenty (20) days of resolution of such Claim; or (ii) through the payment of cash or other property or assets to DoveBid by such Principal Shareholder. To the extent that DoveBid elects to satisfy any Claim for indemnification under this Article VIII by retaining Escrow Shares and the Principal Shareholders do not timely fully pay such Claim in cash, then such shares shall be valued at a price of $10.50 per share (subject to proportional adjustment for any stock splits, stock combinations, recapitalizations or like events) for purposes of satisfying such Claim regardless of whether the actual market price of DoveBid common stock is higher or lower, and in such event DoveBid shall not have the right to recover any deficiency and the Principal Shareholders will not have the right to recover any excess. Claims for indemnification under Section 8 (other than claims made under clause (iv) or (v) of Section 8.2(a)8.2(b) shall be satisfied (x) directly from Compass for Compass’ Pro Rata Percentage by DoveBid by payment of such claim and (y) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount, and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claim. In the event of a Breach by a particular Seller under Section 8.2(b), indemnification for such Breach will be satisfied solely by such Seller (including from such Seller’s Pro Rata Percentage of the Non-Public Stockholder Indemnification Escrow Amount)cash.
(b) Claims made by the Buyer Indemnified Persons for indemnification by a party under clause this Article VIII must be made in writing prior to the expiration of the Survival Period; provided that if a Notice of Claim is asserted in writing before the expiration of the Survival Period, then (ivnotwithstanding the subsequent expiration of the Survival Period) or the obligation of the Principal Shareholders to indemnify the DoveBid Indemnitees (von the one hand) and the obligation of Section 8.2(a) shall be satisfied first from DoveBid to Indemnify the Litigation Escrow Amount and, if Shareholder Indemnitees (on the Litigation Escrow Amount is insufficient to satisfy such claim for indemnification, then, (x) directly from Compass for Compass’ Pro Rata Percentage of such claim and (yother hand) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount such Claim shall continue until such Claim is finally resolved and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claimsatisfied in full in accordance with this Agreement.
(c) Claims made by the Buyer Indemnified Persons for indemnification under Section 6.2(d) shall be governed by such section.
Appears in 2 contracts
Samples: Stock Purchase Agreement (Dovebid Inc), Stock Purchase Agreement (Dovebid Inc)
Satisfaction of Claims. (a) Claims made by Subject to the Buyer Indemnified Persons for indemnification under further provisions of this Section 8 (other than claims made under clause (iv) or (v) of Section 8.2(a)) 8.6 as to disputed indemnity claims, any amounts payable by an Indemnitor pursuant to this Article VIII shall be satisfied delivered by wire transfer in immediately available funds not later than three (x3) directly from Compass for Compass’ Pro Rata Percentage business days after notice by Indemnitee to Indemnitor of such claim and (y) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount, and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claimamount due. In the event of a Breach by a particular Seller under Section 8.2(bdispute as to whether Indemnitor is obligated to indemnify Indemnitee hereunder (an “Indemnity Dispute”), indemnification for such Breach will be satisfied solely by such Seller Indemnitor may (including from such Seller’s Pro Rata Percentage of a) pay indemnity obligations as they arise, and reserve the Non-Public Stockholder Indemnification Escrow Amount).
right to dispute the indemnity obligations hereunder, or (b) Claims made by decline to make indemnity payments and, in the Buyer Indemnified Persons for indemnification under case of either clause (iva) or (vb), either Indemnitor or Indemnitee may commence an Action (subject to Section 10.1 of this Agreement) to determine Indemnitor’s indemnity obligations. Any obligation to pay amounts pursuant to this Article VIII shall bear interest at LIBOR plus 4% from the date (i) the Loss amounts, if any, required to be indemnified by this Article VIII, were paid or incurred by the Indemnitee and (ii) the Loss amounts, if any, were actually paid by the Indemnitor to the Indemnitee and ultimately required to be repaid by the Indemnitee because such Loss amounts fall outside the scope of this Article VIII. In the event of an Indemnity Dispute, Indemnitor and Indemnitee shall have all the rights and remedies available under this Agreement and applicable Law, provided further, if Equityholder breaches its payment obligations under this Section 8.2(a) 8.6 (which payment is agreed by the parties or, if such payment was the subject of an Indemnity Dispute, on the date of the final judgment in respect of such Indemnity Dispute), Buyer shall be satisfied first from entitled to the Litigation Escrow Amount and, if remedy set forth in Section 9.11 of the Litigation Escrow Amount is insufficient to satisfy such claim for indemnification, then, (x) directly from Compass for Compass’ Pro Rata Percentage of such claim and (y) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claimOperating Agreement.
(c) Claims made by the Buyer Indemnified Persons for indemnification under Section 6.2(d) shall be governed by such section.
Appears in 1 contract
Samples: Equity Purchase Agreement (Lions Gate Entertainment Corp /Cn/)
Satisfaction of Claims. (ai) Claims made If a Notice of Claim is given in accordance with Section 3(a) and Escrow Agent does not receive, within 20 business days after the Notice of Claim is received by Shareholder and Xx. Xxxxxxx, a notice from either Shareholder or Xx. Xxxxxxx (an "Objection Notice") stating that a dispute exists relating to the Buyer Indemnified Persons Notice of Claim and the basis of such dispute in reasonable detail, Escrow Agent shall, on the 21st business day after Shareholder's and Xx. Xxxxxxx'x receipt of the Notice of Claim, release from escrow for indemnification under this Section 8 (other than claims made under clause (iv) or (v) transfer to Purchaser that number of Section 8.2(a)) Escrow Shares to satisfy such Claim, based on the Purchaser Stock Valuation Price. Unless otherwise provided for herein, satisfaction of any Claim Amount hereunder shall be satisfied split equally between Shareholder and Xx. Xxxxxxx.
(xii) directly If Escrow Agent receives an Objection Notice within such 20 business day period, Escrow Agent shall promptly forward same to Purchaser and continue to hold the Escrow Shares in escrow until such dispute is resolved. Purchaser and Shareholder, Xx. Xxxxxxx or both, as the case may be (collectively or individually, the "Objecting Party"), shall attempt in good faith to resolve the dispute set forth in the Objection Notice. If Purchaser and the Objecting Party are able to resolve such dispute, Escrow Agent shall release from Compass for Compass’ Pro Rata Percentage escrow to Purchaser that number of such claim Escrow Shares agreed upon by Purchaser and (y) the Objecting Party. If Purchaser and Objecting Party fail to resolve the dispute within 30 calendar days after Escrow Agent receives the Objection Notice, the dispute may at any time thereafter be submitted by Purchaser or the Objecting Party to arbitration in San Diego, California before a single arbitrator reasonably acceptable to both Purchaser and the Objecting Party in accordance with the Commercial Arbitration Rules of the American Arbitration Association then in effect. Purchaser and the Objecting Party will equally split the cost of the arbitration filing and hearing fees, and the arbitrator will have authority to award attorneys' fees to the prevailing party. Purchaser and the Objecting Party agree that the arbitrator's award shall be final and binding upon them with respect to Sellers other than Compassthe dispute and judgment may be entered thereon in any court having jurisdiction thereof; provided, however, that notwithstanding any provision contained herein to the contrary Purchaser and Objecting Party may settle any dispute by mutual agreement at any time. Purchaser, Shareholder and Xx. Xxxxxxx agree that promptly after the issuance of such final award by the arbitrator, Escrow Agent may release from the Non-Public Stockholder Indemnification escrow that number of Escrow AmountShares, and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient any, to satisfy such claim for indemnificationfinal award, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claim. In based on the event of a Breach by a particular Seller under Section 8.2(b), indemnification for such Breach will be satisfied solely by such Seller (including from such Seller’s Pro Rata Percentage of the Non-Public Stockholder Indemnification Escrow Amount)Purchaser Stock Valuation Price.
(b) Claims made by the Buyer Indemnified Persons for indemnification under clause (iv) or (v) of Section 8.2(a) shall be satisfied first from the Litigation Escrow Amount and, if the Litigation Escrow Amount is insufficient to satisfy such claim for indemnification, then, (x) directly from Compass for Compass’ Pro Rata Percentage of such claim and (y) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claim.
(c) Claims made by the Buyer Indemnified Persons for indemnification under Section 6.2(d) shall be governed by such section.
Appears in 1 contract
Samples: Purchase Agreement (Wd 40 Co)
Satisfaction of Claims. (a) Claims made The Vendor may elect to discharge any monetary amount due by it to the Purchaser or JSGP in respect of any Vendor Claim in cash, and if it shall elect not to do so, then such Vendor Claim shall be discharged:
(i) firstly by reducing the amount of the PIK (valued at its nominal value) then held by the Buyer Indemnified Persons Vendor by the amount due in respect of the Vendor Claim; and
(ii) secondly, to the extent that the amount of the PIK is insufficient to pay the amount due, by:
A. (subject to applicable law) transferring to the Purchaser or JSGP or surrendering for indemnification under this Section 8 (other than claims made under clause (iv) or (v) cancellation, such number of Section 8.2(a)) JSGP Vendor Shares and/or JSGP Converted Shares as shall be satisfied sufficient at their Fair Market Value (xafter taking into account any decrease in their value resulting from the relevant Vendor Claim and after taking into account any increase in their value resulting from their cancellation, their being held by the Purchaser or JSGP pending their cancellation or their conversion into Deferred Shares, as the case may be) directly from Compass for Compass’ Pro Rata Percentage to satisfy the amount or balance due of such claim and Vendor Claim; or
B. (y) with respect if the Purchaser or JSGP shall conclude, in their discretion, that such transfer or surrender may not be lawful), converting the number of JSGP Vendor Shares and/or JSGP Converted Shares aforesaid to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow AmountDeferred Shares, and if the Non-Public Stockholder Indemnification Escrow Amount Purchaser, JSGP and the Vendor cannot agree the Fair Market Value, for any purpose for which it is insufficient to satisfy such claim required under this Agreement, any of them may refer the matter for indemnificationdetermination by the Experts, then directly from Sellers (other than Compass)whose decision thereon shall, severally save in case of manifest error, be final and binding on the Purchaser, JSGP and the Vendor. The Experts’ determination shall include a determination of liability as between the Purchaser, JSGP and the Vendor for their costs. The Experts shall act as experts and not jointly for such Seller’s Pro Rata Percentage of such claim. In the event of a Breach by a particular Seller under Section 8.2(b), indemnification for such Breach will be satisfied solely by such Seller (including from such Seller’s Pro Rata Percentage of the Non-Public Stockholder Indemnification Escrow Amount)as arbitrators.
(b) The Vendor shall be required, subject to Clause 4.5(c) to maintain unencumbered in its legal and beneficial ownership the PIK, all of the JSGP Vendor Shares and (if any) all of the JSGP Converted Shares throughout the Restricted Period, provided that, without prejudice to the restrictions on transfer contained in the Shareholders’ Agreement, this Clause 4.5(b) shall not restrict the Partners’ ability to transfer their interests in the Limited Partnership to any person pursuant to the limited partnership agreement establishing the Limited Partnership, subject to any such transfer not compromising or reducing the Limited Partnership’s liability as Vendor.
(i) If a Sale of JSGP shall occur, the Vendor shall be free to sell all of its JSGP Ordinary Shares pursuant thereto.
(ii) If a Listing shall occur prior to the expiry of the Restricted Period, the Vendor shall (subject to Clause 4.5(d)) be free to sell its JSGP Vendor Shares and its JSGP Converted Shares, but shall maintain the resulting Restricted Fund in its possession and shall neither distribute nor by any other means disburse such Restricted Fund until the end of the Restricted Period.
(i) If there shall be any Vendor Claims subsisting that shall not have been finally determined and discharged as at the date which shall be sixty Business Days prior to the end of the Restricted Period, then the Vendor and the Purchaser and/or JSGP (as the case may be) shall seek to agree the Fair Claim Amount in respect of all such Vendor Claims subsisting as at that date. Similarly, in respect of every Vendor Claim that shall be made thereafter, the Vendor and the Purchaser and/or JSGP (as the case may be) shall seek to agree the Fair Claim Amount in respect thereof. In respect of every such Vendor Claim as aforesaid for which the Vendor and the Purchaser and/or JSGP shall fail to so agree within 10 Business Days of such date 60 Business Days prior to the end of the Restricted Period or the date on which such subsequent Vendor Claim is made (as the case may be), they shall refer the matter for determination in accordance with Schedule 6. The aggregate of all Fair Claim Amounts determined pursuant to this Clause shall comprise the “Outstanding Fair Claim Amount”. Upon the final determination and, if relevant, discharge of each relevant Vendor Claim, the Outstanding Fair Claim Amount shall be reduced by an amount equal to the relevant Fair Claim Amount.
(ii) With effect from the end of the Restricted Period to the date upon which all of the Fair Claim Amounts relating to those Vendor Claims outstanding at the end of the Restricted Period are determined, the Vendor shall maintain unencumbered in its legal and beneficial ownership from time to time all of the Restricted Fund, all of the PIK and all of the JSGP Vendor Shares and (if any) JSGP Converted Shares. During the period from the determination of all of the Fair Claim Amounts relating to those said Vendor Claims to the Outstanding Fair Claim Amount being reduced to zero in accordance with Clause 4.5(d)(i), the Vendor shall maintain unencumbered in its legal and beneficial ownership from time to time:-
A. to the extent that the Restricted Fund is equal to or greater than the Outstanding Fair Claim Amount, from time to time, an amount of cash equal to the Outstanding Fair Claim Amount;
B. to the extent that the Outstanding Fair Claim Amount, from time to time, is greater than the amount of the Restricted Fund but equal to or less than the aggregate of the Restricted Fund and the PIK, all of the Restricted Fund and an amount of the PIK equal to the difference between (i) the Restricted Fund; and (ii) the Outstanding Fair Claim Amount;
C. to the extent that the Outstanding Fair Claim Amount, from time to time, is greater than the aggregate of the Restricted Fund and the PIK but equal to or less than the aggregate of the Restricted Fund, the PIK and the Fair Market Value of all of the JSGP Vendor Shares and (if any) JSGP Converted Shares (to be valued as at the end of the Restricted Period), all of the Restricted Fund, all of the PIK and such number of JSGP Vendor Shares and (if any) JSGP Converted Shares (to be valued at the Fair Market Value of those shares as at the end of the Restricted Period) as shall have a Fair Market Value equal to the difference between (i) the aggregate of the Restricted Fund and the PIK; and (ii) the Outstanding Fair Claim Amount; and
D. to the extent that the Outstanding Fair Claim Amount, from time to time, is greater than the aggregate of the Restricted Fund, the PIK and the Fair Market Value of all of the JSGP Vendor Shares and (if any) JSGP Converted Shares (to be valued as at the end of the Restricted Period), all of the Restricted Fund, all of the PIK and all of the JSGP Vendor Shares and (if any) JSGP Converted Shares.
(iii) Upon any sale or repayment of the PIK and/or JSGP Ordinary Shares comprised in the Outstanding Fair Claim Amount, the proceeds thereof (after taxation and costs directly attributable thereto) shall form part of the Restricted Fund from time to time.
(e) In the event that (having complied with the foregoing provisions of this Clause 4.5) the Vendor does not own any PIK or JSGP Vendor Shares or JSGP Converted Shares or any interest therein and there is no Restricted Fund at the time it incurs the obligation to pay any monetary amount, from time to time, to JSGP or the Purchaser pursuant to the terms of this Agreement (which obligation would otherwise be satisfied in accordance with the foregoing provisions of this Clause 4.5)), the parties agree that the Vendor’s liability shall be unconditionally and irrevocably waived and the Vendor shall cease to have any further obligation to make that payment.
(f) If the Purchaser or JSGP is obliged after Completion to pay any amount from time to time due by either of them to the Vendor in respect of any Purchaser Claim, it may elect in its absolute discretion to satisfy its obligation wholly or partly in cash and if and to the extent that it shall not so elect, shall satisfy its obligation by increasing the amount of the PIK by an amount equal to that part of the Purchaser Claim not satisfied in cash. The amount required to satisfy a Purchaser Claim (having regard to the acquisition by the Buyer Indemnified Persons for indemnification under clause (iv) or (v) Vendor of Section 8.2(athe JSGP Vendor Shares) shall be satisfied first from grossed up by being increased by the Litigation Escrow Amount and, if Relevant Proportion of the Litigation Escrow Amount is insufficient to satisfy such claim for indemnification, then, (x) directly from Compass for Compass’ Pro Rata Percentage principal amount of such claim and (y) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claimPurchaser Claim.
(c) Claims made by the Buyer Indemnified Persons for indemnification under Section 6.2(d) shall be governed by such section.
Appears in 1 contract
Satisfaction of Claims. (a) Claims made by In the Buyer Indemnified Persons for indemnification under this Section 8 (other than claims made under clause (iv) event of an Unobjected Claim or (v) of Section 8.2(a)) shall be satisfied (x) directly from Compass for Compass’ Pro Rata Percentage of such claim and (y) a Settlement Memorandum, with respect to Sellers other than Compassclaims pursuant to Section 10.2(a) or Section 10.2(b), Acquiror and the Securityholder Representative shall, subject to the limitations set forth in Section 10.3, as promptly as practicable thereafter, arrange for the cancellation or release, as applicable, of the applicable portion of the Indemnity Escrow Available Recourse (an “Indemnity Claim Release”). The Indemnity Escrow Available Recourse shall be released (i) in the case of Indemnity Escrow Substitute RSUs, by cancellation of the applicable portion thereof by Acquiror, (ii) in the case of Indemnity Escrow Substitute Options, by cancellation of the applicable portion thereof by Acquiror and (iii) in the case of Indemnity Escrow Shares, by release to Acquiror of the applicable number of Indemnity Escrow Shares from the Non-Public Stockholder Indemnification Indemnity Escrow Amount, and if Fund. All distributions from the Non-Public Stockholder Indemnification Indemnity Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such SellerAvailable Recourse shall be made based on each Indemnifying Party’s Pro Rata Percentage Indemnity Escrow Portion of such claimAcquiror’s Losses. In the event of an Indemnity Claim Release, Acquiror and the Securityholder Representative shall deliver a Breach joint written instruction to the Escrow Agent (a “Release Instruction”) to release a specified number of Indemnity Escrow Shares to Acquiror, which shall include the number of Indemnity Escrow Shares to be released from the Indemnity Escrow Fund and the number of Indemnity Escrow Substitute RSUs to be cancelled by a particular Seller Acquiror in connection with such Indemnity Claim Release. With respect to any Indemnifying Parties whose Indemnity Escrow Equity is subject to vesting, the Indemnity Escrow Shares, the Indemnity Escrow Substitute Options and the Indemnity Escrow Substitute RSUs to be released or cancelled, as applicable, shall be satisfied by (i) first, releasing Indemnity Escrow Shares in reverse chronological order of latest vesting, (ii) second, cancelling Indemnity Escrow Substitute RSUs in reverse chronological order of latest to satisfy time-based vesting requirements under Section 8.2(b1.1(h)(ii), indemnification for such Breach will be satisfied solely by such Seller (including from such Seller’s Pro Rata Percentage of the Non-Public Stockholder Indemnification iii) third, cancelling Indemnity Escrow Amount).
(b) Claims made by the Buyer Indemnified Persons for indemnification under clause Substitute Options and (iv) fourth, releasing Indemnity Escrow Shares which are not subject to vesting, and the Indemnity Escrow Shares, Indemnity Escrow Substitute RSUs and Indemnity Escrow Substitute Options to be so released or cancelled, as applicable, shall have an aggregate value (vwith each Indemnity Escrow Share and each Indemnity Escrow Substitute RSU being valued at the Acquiror Share Deemed Value and each Indemnity Escrow Substitute Option being valued at the Acquiror Share Deemed Value minus the amount of the exercise price of such Indemnity Escrow Substitute Option) equal to, in the aggregate, the amount of Acquiror Losses set forth in the Claim Notice with respect to an Unobjected Claim or in the Settlement Memorandum the release of which by the Escrow Agent or cancellation of which by Acquiror, as applicable. The release of Indemnity Escrow Shares to Acquiror and the cancellation by Acquiror of Indemnity Escrow Substitute Options and Indemnity Escrow Substitute RSUs as contemplated in this Section 8.2(a) 10.4(d), shall be satisfied first from satisfy the Litigation Escrow Amount payment obligation to each Indemnified Party, and, if the Litigation value of the Indemnity Escrow Amount Shares, Indemnity Escrow Substitute Options and Indemnity Escrow Substitute RSUs then remaining in the Indemnity Escrow Available Recourse is insufficient to satisfy such claim for indemnification, then, (x) directly from Compass for Compass’ Pro Rata Percentage cover the full amount of such claim and (y) Acquiror Losses set forth in the Claim Notice with respect to Sellers other than Compassan Unobjected Claim or in the Settlement Memorandum, from each Indemnifying Party shall, subject to the Non-Public Stockholder Indemnification Escrow Amount and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy limitations set forth in this Article X, within thirty (30) days, pay in cash such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such SellerIndemnifying Party’s Pro Rata Percentage Portion of such claim.
(c) Claims made by Acquiror Losses to Acquiror in excess of the Buyer aggregate amount remaining in the Indemnity Escrow Available Recourse in satisfaction of each Indemnified Persons for indemnification Party’s portion of the applicable Acquiror Losses. For clarity, any Indemnity Escrow Substitute RSU that has not satisfied the time-based vesting requirements under Section 6.2(d1.1(h)(ii) shall be governed by as of the date of such sectionrelease will continue to remain subject to the time-based vesting requirements set forth therein.”
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Satisfaction of Claims. (a) Claims Payment for any indemnifiable Losses suffered by any Purchaser Indemnified Party pursuant to this Article VIII shall be made by the Buyer Indemnified Persons for indemnification under pursuant to this Section 8 8.5 when either (other than claims made under clause i) the Seller Indemnifying Party (iv) or (v) of Section 8.2(a)) shall be satisfied (x) directly from Compass for Compass’ Pro Rata Percentage of such claim and (y) which with respect to a claim against Sellers other than Compass, from a breach of a representation or warranty under Article IV or covenant under Article X shall be the Non-Public Stockholder Indemnification Escrow Amount, Seller Representative) and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage Purchaser Indemnified Party agree on the amount of such claim. In indemnifiable Losses or (ii) the event amount of indemnifiable Losses is finally adjudicated (each, a Breach by a particular Seller under Section 8.2(b), indemnification for such Breach will be satisfied solely by such Seller (including from such Seller’s Pro Rata Percentage of the Non-Public Stockholder Indemnification Escrow Amount“Final Resolution”).
(b) Claims made by The Sellers agree and acknowledge that the Buyer Indemnified Persons for indemnification under clause (iv) or (v) of Section 8.2(a) shall be satisfied first from the Litigation Escrow Amount and, if the Litigation Escrow Amount is insufficient intended to provide Purchaser the ability to satisfy the several obligations of the Sellers hereunder, whether such indemnification amounts are payable by one or all of the Sellers. Within ten (10) Business Days after Final Resolution of any indemnification claim for Losses by any Purchaser Indemnified Party under this Article VIII pursuant to which such Purchaser Indemnified Party is entitled to any payment:
(i) If, pursuant to Section 5(f) of the Escrow Agreement, there are funds available in the Escrow Account to satisfy such claim for indemnificationLosses, thenthe Seller Representative and Purchaser shall execute and cause a joint written direction to be delivered to the Escrow Agent pursuant to the Escrow Agreement (a “Joint Direction”), which Joint Direction shall direct the Escrow Agent to make such payment out of the Escrow Account; or
(xii) directly If such Losses are based upon, arising out of or otherwise in respect of Section 8.1(a) resulting from Compass for Compass’ Pro Rata Percentage a breach of any Seller Specified Representation or Sections 8.1(b) or 8.1(c) and the funds available in the Escrow Account to satisfy such claim and (y) Losses have been exhausted or otherwise released in accordance with the Escrow Agreement, each Seller shall pay to the applicable Purchaser Indemnified Party, by wire transfer of immediately available funds, the amount such Seller is required to indemnify such Purchaser Indemnified Party pursuant to this Article VIII with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount and if the Non-Public Stockholder Indemnification Escrow Amount such Losses which is insufficient not satisfied pursuant to satisfy such claim for indemnification, then directly from Sellers (other than CompassSection 8.5(a)(i), severally and not jointly for such Seller’s Pro Rata Percentage of such claim.
(c) Claims made by the Buyer Indemnified Persons for indemnification under Section 6.2(d) shall be governed by such section.
Appears in 1 contract
Samples: Stock Purchase Agreement (Nuance Communications, Inc.)
Satisfaction of Claims. 3.01 Without prejudice to the other clauses in this Part 3, prior to the Release Date, the Purchaser shall, pursuant to Clause 14.12 of the Acquisition Agreement, have the right to satisfy the amount of any Claim or other claim under the Acquisition Agreement against a Warrantor (whether in his capacity as a Warrantor or otherwise) by set-off or otherwise, as appropriate, in such manner as the Purchaser may elect as permitted by law, against the Deposited Cash and/or the Deposited Securities held by the Escrow Agent in respect of that Warrantor (an “Escrow Claim”). Accordingly, no Deposited Cash or Deposited Securities shall be released to that Warrantor prior to the Release Date unless the Purchaser shall give its prior written consent in its absolute discretion. The Deposited Cash and the Deposited Securities, together with all Additional Escrow Property and Additional Escrow Cash (the aggregate thereby being the “Deposited Funds”), shall be held by the Escrow Agent in respect of that Warrantor until either:
(a) Claims the amount of the liability of the relevant Warrantor with respect to any Escrow Claim made by the Buyer Indemnified Persons for indemnification under this Section 8 Purchaser on or before the Release Date, such amount either having been agreed upon by the Purchaser and the relevant Warrantor in writing or having been finally determined in accordance with clause 3.05 (other than claims made under clause (iv) or (v) of Section 8.2(a)) shall be satisfied (x) directly from Compass for Compass’ Pro Rata Percentage of such claim and (y) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow “Specified Amount, and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass”), severally and not jointly for such Seller’s Pro Rata Percentage when the terms of such claim. In clause 3.02 or 3.03 shall apply (as the event of a Breach by a particular Seller under Section 8.2(bcase may be), indemnification for such Breach will be satisfied solely by such Seller (including from such Seller’s Pro Rata Percentage of the Non-Public Stockholder Indemnification Escrow Amount).; or
(b) Claims the Release Date when, subject to the provisions of clause 3.04, the Escrow Agent is hereby irrevocably instructed to release the Deposited Funds (or so much of them as remains after the operation of the provisions of this Agreement) held in respect of a Warrantor, to the relevant Warrantor.
3.02 If the Escrow Agent receives prior to the Release Date a disbursement certificate in substantially the form attached hereto as Exhibit A (a “Disbursement Certificate”), executed by a Warrantor or the Warrantors’ Representative in respect of more than one Warrantor and a duly authorized representative of the Purchaser notifying a Specified Amount in respect of the relevant Warrantor(s) and such Specified Amount is equal to or greater than the Deposited Funds held in respect of the relevant Warrantor(s), then the Escrow Agent is hereby irrevocably instructed to release the Deposited Funds held in respect of the relevant Warrantor(s) to the Purchaser.
3.03 If the Escrow Agent receives prior to the Release Date a Disbursement Certificate, executed by the Warrantors or the Warrantors’ Representative in respect of more than one Warrantor and a duly authorized representative of the Purchaser notifying a Specified Amount in respect of the relevant Warrantor(s) and such Specified Amount is less than the amount of the Deposited Funds held in respect of the relevant Warrantor(s), then the Escrow Agent is hereby irrevocably instructed to release such part of the Deposited Cash and (if so required by reason of the quantum of the Specified Amount) the Deposited Securities (in each case, held in respect of the relevant Warrantor(s)) as is equal to such Specified Amount to the Purchaser, together with such proportion of the Additional Escrow Cash and Additional Escrow Property as proportionately relates to such principal Specified Amount. All such releases shall be of Deposited Funds in accordance with Clause 3.10. The remainder of the Deposited Funds shall be re-lodged or continue to be held in escrow by the Escrow Agent pursuant to the provisions of this Part 3 until either another Escrow Claim is duly made or the Release Date, whichever shall occur earlier, and the terms of this Part 3 shall apply thereto.
3.04 If any bona fide Escrow Claim made by the Buyer Indemnified Persons for indemnification under clause Purchaser on or before the Release Date has not been agreed in writing or finally determined as at the Release Date, then (ivsubject to Clause 3.07) or (v) the Deposited Funds held in respect of Section 8.2(athe relevant Warrantor(s) shall not be satisfied first released by the Escrow Agent until the relevant Warrantors’ liability (if any) for the Escrow Claim and the Specified Amount of such Escrow Claim has been agreed by the Purchaser and the relevant Warrantor(s) in writing or finally determined, whereupon:
(a) if the Specified Amount so agreed is equal to or greater than the Deposited Funds held in respect of the relevant Warrantor(s), then the Escrow Agent is hereby irrevocably instructed to release the Deposited Funds held in respect of the relevant Warrantor(s) to the Purchaser; or
(b) if the Specified Amount so agreed or determined is less than the Deposited Funds held in respect of the relevant Warrantor(s), then the Escrow Agent is hereby irrevocably instructed to release to the Purchaser such amount as shall be equal to the Specified Amount and to release the balance of the Deposited Funds held in respect of the relevant Warrantor(s) to the relevant Warrantor(s).
3.05 For the purposes of this Part 3, an Escrow Claim shall be deemed to be finally determined:
(a) in the case of a Non-Tax Claim, if and when judgment has been given by a court of competent jurisdiction from which there is no right of appeal or the time limit for appeal has expired without the relevant Warrantor or Purchaser appealing; or
(b) in the case of a Tax Claim, if and when determined by the General Commissioners of Inland Revenue, the Special Commissioners of Inland Revenue or Value Added Tax Tribunal or any equivalent forum in the United Kingdom or any other relevant jurisdiction unless no appeal to any such body from the Litigation decision of the Taxation Authority or court of first instance has been made by the relevant Warrantor or the Purchaser or the Group Company on their instructions (as the case may be) within the period in which any appeal may properly be brought, when the determination of the Taxation Authority or court of first instance is deemed to be the final determination of the claim.
3.06 Upon any such Escrow Amount andClaim as is referred to in Clause 3.04 being agreed or finally determined in accordance with Clause 3.05, the relevant Warrantor or Warrantors’ Representative (in respect of more than one Warrantor) and a duly authorized representative of the Purchaser shall immediately deliver to the Escrow Agent a Disbursement Certificate, duly executed by them and on receipt of the same the provisions of clause 3.03 shall apply thereto.
3.07 If at any time after a payment from escrow has been deferred beyond the Release Date pursuant to Clause 3.04, the Purchaser decides to withdraw in whole or in part the Escrow Claim which gave rise to such deferral, payment of the relevant amount no longer claimed shall be made as soon as practicable to the relevant Warrantor and the Escrow Agent is hereby irrevocably instructed and authorised accordingly.
3.08 The Escrow Agent shall also release the Deposited Funds, or relevant portions thereof, to the appropriate party:
(a) upon receipt by the Escrow Agent of a certified copy or original of an order, direction, decree or judgment of any Court of competent jurisdiction requiring or authorizing the Escrow Agent so to do (whether pursuant to a Claim or otherwise); or
(b) if the Litigation Escrow Amount Agent is insufficient otherwise required by any applicable law or regulation to satisfy such claim do so.
3.09 Any fraction of a Deposited Security shall be ignored in calculating those Deposited Securities that shall remain in or be released from escrow. For the purposes of this Agreement the Deposited Securities shall have the same value as attributed to the Consideration Shares for indemnificationthe purposes of the Acquisition Agreement. In assessing the value in United States Dollars an Escrow Claim, thenthe Escrow Agent shall translate Pounds Sterling into United States Dollars at the Exchange Rate.
3.10 The rights granted to the Purchaser in this Part 3 are, (x) directly from Compass as in relation to the Vendors and the Warrantors, in addition to and not in substitution for Compass’ Pro Rata Percentage of such claim any other rights, remedies and (y) powers available to the Purchaser with respect to Sellers other than Compassany Escrow Claim which it may have against the Vendors and/or Warrantors provided, however, that Purchaser shall first make an Escrow Claim and exhaust first the Deposited Cash and Additional Escrow Cash and secondly the Deposited Securities and Additional Escrow Property prior to seeking remedies directly against any of the Warrantors.
3.11 The Escrow Agent shall bear no responsibility for any release of Deposited Securities occurring after an Escrow Claim arises if it has not received notice of a bona fide Escrow Claim (a “Notice”) prior to the Release Date. The Escrow Agent shall further not be required to undertake any enquiries of any nature or use its own discretion to determine if any Escrow Claim is bona fide or has been made in good faith and for no improper purpose, but shall be permitted to rely solely on a Notice from the Non-Public Stockholder Indemnification Purchaser (or absence thereof) as described herein. No Notice shall be effective unless actually received by the Escrow Amount and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claimAgent.
3.12 Upon the release to the Purchaser of any Deposited Funds, the Warrantor who deposited such Deposited Funds shall cease to have any ownership interest of any nature in them and the Warrantor shall do such acts and things and execute such documents as the Purchaser may require in order to extinguish such Warrantor’s beneficial or other ownership interest in them (c) Claims made by including, without limitation, executing such instruments of transfer as the Buyer Indemnified Persons Purchaser may require to register such securities in the name of any person the Purchaser may wish). If any Warrantor shall fail to do or execute any such requisite things, each Warrantor hereby irrevocably appoints the Purchaser as its due and lawful attorney and agent with all powers available at law to do so on his behalf (including but without limit the ability to give a receipt and good discharge to any third party, who shall not be obliged to enquire any further into title to the relevant Deposited Funds). Without prejudice to the foregoing, the Purchaser may, subject to applicable law, buy back, cancel, redeem or surrender any such securities for indemnification under Section 6.2(d) shall be governed by nil or nominal consideration or subject to such sectionterms as the Purchaser may require or hold them in treasury.
Appears in 1 contract
Samples: Escrow Agreement (Activcard Corp)
Satisfaction of Claims. (a) Claims made Each Seller’s indemnification obligation for Losses suffered by the Buyer Indemnified Persons any Purchaser Indemnitee for indemnification which such Purchaser Indemnitee is entitled to payment under this ARTICLE XI shall be satisfied, at Parent’s sole option, by any one or more of the following:
(i) Parent shall be entitled to set off the amount of such Loss against the aggregate amount of any Earn-Out Payment earned but unpaid to Seller pursuant to Section 8 2.06.
(other than claims made under clause ii) Parent shall be entitled to determine the amount, if any, of such Loss to be satisfied from funds then remaining in the General Escrow Account, and Parent and Agent shall submit joint written instructions to the Escrow Agent to release such funds to the Purchaser Indemnitee pursuant to the terms of the Escrow Agreement.
(iii) Parent shall be entitled to require Seller to tender to Parent or its Affiliates, and Parent or its Affiliates shall redeem from such Seller, that number of shares of the Stock Consideration received hereunder having a value equal to up to the amount of Losses to be satisfied. Solely for the purposes of determining the number of shares of Stock Consideration to be tendered and redeemed, the Stock Consideration shall be deemed to have a value per share equal to the average trading price of the Parent’s common stock over the previous 20 trading day period (subject to adjustment to reflect any stock split, stock dividend, or the like with respect to the Stock Consideration prior to the redemption date).
(iv) or (vIf the remedies under Sections 11.08(a)(i)-(iii) of Section 8.2(a)) shall be satisfied (x) directly from Compass for Compass’ Pro Rata Percentage of such claim and (y) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount, and if the Non-Public Stockholder Indemnification Escrow Amount is are insufficient to satisfy such claim for indemnificationLoss, then directly from Sellers (other than Compass), severally and not jointly for shall pay to such Seller’s Pro Rata Percentage Purchaser Indemnitee any remaining amount due by wire transfer of such claim. In the event of a Breach by a particular Seller under Section 8.2(b), indemnification for such Breach will be satisfied solely by such Seller (including from such Seller’s Pro Rata Percentage of the Non-Public Stockholder Indemnification Escrow Amount)immediately available funds.
(b) Claims made Within ten Business Days after final resolution pursuant to Section 11.05 of any indemnification claim by any Purchaser Indemnitee hereunder, Parent shall notify Agent of the Buyer Indemnified Persons for indemnification under clause (iv) or (v) manner of Section 8.2(a) shall be satisfied first from the Litigation Escrow Amount and, if the Litigation Escrow Amount is insufficient to satisfy such claim for indemnification, then, (x) directly from Compass for Compass’ Pro Rata Percentage satisfaction of such claim and (y) Loss with respect to Sellers other than Compasseach Seller. Within ten Business Days after receipt of the foregoing notice, from the Non-Public Stockholder Indemnification Escrow Amount and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient each Seller obligated to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage a portion of such claimthe Loss shall take all actions necessary to satisfy its indemnification obligation.
(c) Claims Within ten Business days after final resolution pursuant to Section 11.05 of any indemnification claim by any Seller Indemnitee hereunder pursuant to which any Seller Indemnitee is entitled to any payment, such payment shall be made by the Buyer Indemnified Persons for indemnification under Section 6.2(d) shall be governed by such sectionor on behalf of Purchaser.
Appears in 1 contract
Samples: Membership Interest Purchase Agreement (Aceto Corp)
Satisfaction of Claims. (ai) Claims If payment is to be made to a Parent Indemnified Party from the Escrow Fund pursuant to Section 9.4(e)(ii), Parent and the Securityholder Representative shall promptly deliver joint written instructions to the Escrow Agent directing the Escrow Agent to release from the Escrow Fund to the applicable Parent Indemnified Party the amount of cash and number of shares of Parent Common Stock so payable, plus a pro rata portion (based on the amount of such reduction of the Escrow Fund relative to the amount of cash and number of shares of Parent Common Stock in the Escrow Fund as of immediately before such release) of all amounts in the Escrow Fund that exceed the Escrow Amount as of immediately before such release (i.e., earnings (including interest and dividends) on the Escrow Amount and on such earnings in accordance with the Escrow Agreement); provided, that (A) no fractional shares shall be released to any Indemnified Party pursuant to this Section 9.3(b) and 9.5(b)(i), (B) the Indemnified Parties shall have no right to recover any amount of cash in lieu of any fraction of a share of Parent Common Stock to which such holder would otherwise have had a right, and (C) any cash and shares that remain undistributed by the Buyer Escrow Agent as a result of this proviso shall be released by the Escrow Agent to Parent. To the extent that any distribution of shares of Parent Common Stock from the Escrow Fund to an Indemnified Persons for indemnification under this Section 8 Party (other than claims made under clause (ivParent) or (v) would, in the reasonable discretion of Section 8.2(a)) Parent, fail to comply with applicable securities laws, then, upon the receipt of notice from Parent, the Escrow Agent shall be satisfied distribute such shares from the Escrow Fund to Parent and Parent shall pay such Indemnified Party an amount in cash equal to the product of (x) directly from Compass for Compass’ Pro Rata Percentage the number of shares of Parent Common Stock to which such claim Indemnified Party would otherwise be entitled pursuant to this Section 9.5(b)(i) and (y) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount, and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claim. In the event of a Breach by a particular Seller under Section 8.2(b), indemnification for such Breach will be satisfied solely by such Seller (including from such Seller’s Pro Rata Percentage of the Non-Public Stockholder Indemnification Escrow Amount)Parent Common Stock Price.
(bii) Claims If payment is to be made to the Final Surviving Company from the Escrow Fund pursuant to Section 9.4(e)(iii) or the last sentence of Section 9.4(e)(iii), Parent and the Securityholder Representative shall promptly deliver joint written instructions to the Escrow Agent directing the Escrow Agent to release to the Final Surviving Company the amount of cash and number of shares of Parent Common Stock (rounded down to the nearest whole share) so payable plus a pro rata portion (based on the amount of such reduction of the Escrow Fund relative to the amount of cash and number of shares of Parent Common Stock in the Escrow Fund immediately before such release) of all amounts in the Escrow Fund that exceed the Escrow Amount as of immediately before such release (i.e., earnings (including interest and dividends) on the Escrow Amount and on any such earnings in accordance with the Escrow Agreement) (and the Final Surviving Company shall then promptly distribute such cash and shares of Parent Common Stock to each such Company Securityholder so that each such Company Securityholder receives such amount attributable to it, him or her); provided, that (A) no fractional shares shall be distributed by the Buyer Indemnified Persons for indemnification under clause Final Surviving Company to any Company Securityholder, (ivB) or (v) any fraction of Section 8.2(a) a share of Parent Common Stock to which such Company Securityholder would otherwise be entitled shall be satisfied first paid in cash in accordance with Section 2.8(i), and (C) any cash and shares that remain undistributed by the Escrow Agent as a result of this proviso shall be returned by the Escrow Agent to Parent.
(iii) Notwithstanding anything to the contrary in this Agreement, to the extent that any distribution of shares of Parent Common Stock from the Litigation Escrow Amount andFund to a Company Securityholder would, if in the Litigation Escrow Amount is insufficient reasonable discretion of Parent, fail to satisfy such claim for indemnificationcomply with applicable securities laws, then, upon the receipt of notice from Parent, the Escrow Agent shall distribute such shares from the Escrow Fund to Parent and Parent shall pay such Company Securityholder an amount in cash equal to the product of (x) directly from Compass for Compass’ Pro Rata Percentage the number of shares of Parent Common Stock to which such claim Indemnifying Holder would otherwise be entitled pursuant to this Article IX and (y) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claimParent Common Stock Price.
(civ) Claims If payment is to be made by to a Parent Indemnified Party from the Buyer WC Escrow Fund pursuant to Section 9.4(e)(iv), Parent and the Securityholder Representative shall promptly deliver joint written instructions to the Escrow Agent directing the Escrow Agent to release from the WC Escrow Fund to the applicable Parent Indemnified Persons for indemnification under Section 6.2(d) shall be governed by such sectionParty the amount of cash so payable.
Appears in 1 contract
Samples: Merger Agreement (Repligen Corp)
Satisfaction of Claims. (ai) Claims made by If the Buyer Escrow Amount attributable to any Indemnifying Holder is to be reduced pursuant to Section 9.5(e)(ii), Parent and the Securityholder Representative shall promptly deliver joint written instructions to the Escrow Agent directing the Escrow Agent to release to the applicable Parent Indemnified Persons for indemnification under Party a number of shares of Parent Common Stock from the Escrow Fund determined in accordance with the provisions of Section 9.5(e); provided, that (A) no fractional shares shall be released to any Parent Indemnified Party pursuant to this Section 8 9.6(b)(i) and (B) the Parent Indemnified Parties shall have no right to recover any amount of cash in lieu of any fraction of a share of Parent Stock. To the extent that any distribution of shares of Parent Common Stock from the Escrow Fund to a Parent Indemnified Party (other than claims made under clause (ivParent) or (v) would, in the reasonable discretion of Section 8.2(a)) Parent, fail to comply with applicable securities laws, then, upon the receipt of notice from Parent, the Escrow Agent shall be satisfied distribute such shares from the Escrow Fund to Parent and Parent shall pay such Parent Indemnified Party an amount in cash equal to the product of (x) directly from Compass for Compass’ Pro Rata Percentage the number of shares of Parent Common Stock to which such claim Parent Indemnified Party would otherwise be entitled pursuant to this Section 9.6(b)(i) and (y) with respect the last quoted trading price per share of Parent Common Stock on the NYSE on the last day during which Parent Common Stock was available for trading on the NYSE immediately prior to Sellers other than Compassthe date of such payment by Parent to such Parent Indemnified Party.
(ii) If the Escrow Amount attributable to any Indemnifying Holder is to be reduced pursuant to Section 9.5(e)(iii) or the last sentence of Section 9.5(e)(iv), Parent and the Securityholder Representative shall promptly deliver joint written instructions to the Escrow Agent directing the Escrow Agent to release to the Exchange Agent a number of shares of Parent Common Stock (rounded down to the nearest whole share) and/or cash, as applicable, from the Non-Public Stockholder Indemnification Escrow Amount, and if Fund equal to the Non-Public Stockholder Indemnification amount of such reduction of the Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers plus a pro rata portion (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage based on the amount of such claim. In the event of a Breach by a particular Seller under Section 8.2(b), indemnification for such Breach will be satisfied solely by such Seller (including from such Seller’s Pro Rata Percentage reduction of the Non-Public Stockholder Indemnification Escrow Amount).
(b) Claims made by Amount relative to the Buyer Indemnified Persons for indemnification under clause (iv) or (vaggregate Escrow Amount as of immediately before such release) of Section 8.2(a) shall be satisfied first from all amounts in the Litigation Escrow Fund that exceed the aggregate Escrow Amount andas of immediately before such release (i.e., if dividends on the Litigation Escrow Amount is insufficient to satisfy such claim for indemnification, then, (x) directly from Compass for Compass’ Pro Rata Percentage of such claim and (y) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount and if earnings on any such cash dividends) (and the Non-Public Stockholder Indemnification Escrow Amount is insufficient Exchange Agent shall then promptly distribute such shares of Parent Common Stock to satisfy each such claim for indemnificationIndemnifying Holder so that each such Indemnifying Holder receives such amount attributable to it, then directly from Sellers him or her); provided, that (other than CompassA) no fractional shares shall be distributed by the Securityholder Representative to any Indemnifying Holder, (B) any fraction of a share of Parent Common Stock to which such Indemnifying Holder would otherwise be entitled shall be paid in cash in accordance with Section 2.8(j), severally and not jointly (C) any shares that would have constituted fractional shares but for such Seller’s Pro Rata Percentage of such claim.
clause (cB) Claims made and which remain undistributed by the Buyer Indemnified Persons for indemnification under Section 6.2(d) Escrow Agent as a result of this proviso shall be governed returned by such sectionthe Escrow Agent to Parent.
Appears in 1 contract
Samples: Agreement and Plan of Merger (Millennial Media Inc.)
Satisfaction of Claims. (ai) Claims made On the date that any Claim becomes a Payable Claim for which a Purchaser Indemnified Party has elected to seek recovery from the Escrow Fund, the Escrow Amount shall be irrevocably and immediately reduced by the Buyer Indemnified Persons for indemnification under this Section 8 (other than claims made under clause (iv) or (v) of Section 8.2(a)) shall be satisfied (x) directly from Compass for Compass’ Pro Rata Percentage amount of such claim and the payment of such amount from the Escrow Fund shall be made to the Purchaser Indemnified Parties in accordance with this Section 7.6(c)(i). In such event, Purchaser and Seller shall promptly deliver joint written instructions to the Escrow Agent directing the Escrow Agent to release to the applicable Purchaser Indemnified Party an amount from the Escrow Fund equal to the amount of each such reduction of the Escrow Amount, plus a pro rata portion (ybased on the amount of such reduction of the Escrow Amount relative to the rest of the aggregate Escrow Amount) of all amounts in the Escrow Fund that exceed the aggregate Escrow Amount as of immediately before such release.
(ii) At the Escrow Release Time, if the Escrow Amount exceeds the amount of the Unresolved Claims that, if successful, would be payable by Seller, then the remaining Escrow Amount shall be reduced by the amount of such excess and paid from the Escrow Fund to Seller in accordance with this Section 7.6(c)(ii). In addition, from and after the Escrow Release Time, until the Escrow Amount has been fully depleted pursuant to Section 7.6(c)(i), at such time that each Unresolved Claim becomes resolved as a Payable Claim, either in full or in part, the portion of the Escrow Amount attributable to a Payable Claim shall be paid to the Purchaser Indemnified Party in accordance with Section 7.6(c)(i), and the portion of the Escrow Amount attributable to a Claim that is not a Payable Claim and that is not necessary to satisfy any Unresolved Claims, that, if successful, would be payable by Seller shall be paid to Seller in accordance with this Section 7.6(c)(ii). In such event, Purchaser and Seller shall promptly deliver joint written instructions to the Escrow Agent directing the Escrow Agent to release to Seller an amount from the Escrow Fund equal to the amount of such reduction of the Escrow Amount, plus a pro rata portion (based on the amount of such reduction of the Escrow Amount relative to the rest of the aggregate Escrow Amount) of all amounts in the Escrow Fund that exceed the aggregate Escrow Amount as of immediately before such release.
(iii) Until the Escrow Release Time, Purchaser shall have the right (but not the obligation) to recover, from time to time, all or part of the amount of any Payable Claims by setting off such amount against all or part of the amount then-owing by Seller to Purchaser with respect to Sellers other than Compassthe Royalty Payments under the License Agreement; provided, however, that the amount of all Payable Claims satisfied by offset pursuant to this Section 7.6(c)(iii) shall not exceed the Royalty Payments Offset Amount, it being understood that any deductions from the Non-Public Stockholder Indemnification Escrow Fund shall not count towards the Royalty Payments Offset Amount, and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claim. In the event of a Breach by a particular Seller under Section 8.2(b), indemnification for such Breach will be satisfied solely by such Seller (including from such Seller’s Pro Rata Percentage of the Non-Public Stockholder Indemnification Escrow Amount).
(b) Claims made by the Buyer Indemnified Persons for indemnification under clause (iv) or (v) of Section 8.2(a) shall be satisfied first from the Litigation Escrow Amount and, if the Litigation Escrow Amount is insufficient to satisfy such claim for indemnification, then, (x) directly from Compass for Compass’ Pro Rata Percentage of such claim and (y) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claim.
(c) Claims made by the Buyer Indemnified Persons for indemnification under Section 6.2(d) shall be governed by such section.
Appears in 1 contract
Samples: Asset Purchase Agreement (Schiff Nutrition International, Inc.)
Satisfaction of Claims. 57-
(a) Claims made The Company and Parent agree that any Claim for indemnification under Section 12.2(a) will at, Parent's sole discretion, be satisfied by either (i) reducing dollar for dollar the Buyer Indemnified Persons Deferred Indemnity Consideration and/or the Deferred Management Retention Consideration payable under Section 2.3, and/or (ii) setting-off any Earnout Amounts payable under Section 2.4 and Exhibit C. The Company and Parent agree that --------- any Claim for indemnification under Section 12.2(b) will, at Parent's sole discretion, be satisfied by either (i) reducing dollar for dollar the Deferred Indemnity Consideration and/or the Deferred Management Retention Consideration payable under Section 2.3, and/or (ii) setting-off any Earnout Amounts payable under Section 2.4 and Exhibit C; provided, that if --------- such Claim cannot be fully satisfied by reducing dollar for dollar the Deferred Indemnity Consideration and/or the Deferred Management Retention Consideration payable under Section 2.3, and/or setting-off any Earnout Amounts payable under Section 2.4, then Parent may seek to satisfy such Claim through the payment of cash or other property or assets to Parent by such Member. To the extent that Parent elects to satisfy any Claim for indemnification under this Article 12 by setting-off payment of Earnout Amounts payable under Section 8 (other than claims made under clause (iv) or (v) 2.4 and Exhibit C consisting of Section 8.2(a)) shares of --------- Parent Common Stock, then such shares shall be satisfied (x) directly from Compass valued for Compass’ Pro Rata Percentage such purpose at the Parent Average Price Per Earnout Share, regardless of such claim and (y) with respect to Sellers other than Compass, from whether the Non-Public Stockholder Indemnification Escrow Amountactual market price or value of Parent Common Stock is higher or lower, and if in such event Parent shall not have the Non-Public Stockholder Indemnification Escrow Amount is insufficient right to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally recover any deficiency and the Company Members will not jointly for such Seller’s Pro Rata Percentage of such claimhave the right to recover any excess. In the event of a Breach by a particular Seller under Section 8.2(b), indemnification for such Breach will be satisfied solely by such Seller (including from such Seller’s Pro Rata Percentage Capital Change after the end of the Non-Public Stockholder Indemnification Escrow Amount)applicable Earnout Period, the Parent Average Price Per Earnout Share will, for purposes of this Section 12.6, be proportionally and equitably adjusted.
(b) Claims made by the Buyer Indemnified Persons for indemnification by a party under clause this Article 12 must be made in writing prior to the expiration of the applicable Representation Termination Date; provided that if a Notice of Claim is asserted in writing before the expiration of the Representation Termination Date, then (ivnotwithstanding the subsequent expiration of the Representation Termination Date, or the passing of the Deferred Consideration Payment Date or the Earnout Payment Date) or (v) the obligation of Section 8.2(a) shall be satisfied first from the Litigation Escrow Amount and, if Company Members to indemnify the Litigation Escrow Amount is insufficient to satisfy such claim for indemnification, then, (x) directly from Compass for Compass’ Pro Rata Percentage of such claim Parent and (y) the Parent Indemnitees with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount such Claim shall continue until such Claim is finally resolved and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claimsatisfied in full in accordance with this Agreement.
(c) Claims made by the Buyer Indemnified Persons for indemnification under Section 6.2(d) shall be governed by such section.
Appears in 1 contract
Samples: Merger Agreement (Pemstar Inc)
Satisfaction of Claims. (ai) Claims If payment is to be made to Parent from the Escrow Fund pursuant to Section 9.4(e)(ii), Parent and the Stockholder Representative shall promptly deliver joint written instructions to the Escrow Agent directing the Escrow Agent to release from the Escrow Fund to the applicable Indemnified Party the number of shares of Parent Common Stock so payable; ACTIVE/108710474.16 provided, that (A) no fractional shares shall be released to any Indemnified Party pursuant to this Section 9.5(b)(i), (B) the Indemnified Parties shall have no right to recover any amount of cash in lieu of any fraction of a share of Parent Common Stock to which such holder would otherwise have had a right, and (C) any shares that remain undistributed by the Buyer Escrow Agent as a result of this proviso shall be released by the Escrow Agent to Parent. To the extent that any distribution of shares of Parent Common Stock from the Escrow Fund to an Indemnified Persons for indemnification under this Section 8 Party (other than claims made under clause (ivParent) or (v) would, in the reasonable discretion of Section 8.2(a)) Parent, fail to comply with applicable securities laws, then, upon the receipt of notice from Parent, the Escrow Agent shall be satisfied distribute such shares from the Escrow Fund to Parent and Parent shall pay such Indemnified Party an amount in cash equal to the product of (x) directly from Compass for Compass’ Pro Rata Percentage the number of shares of Parent Common Stock to which such claim Indemnified Party would otherwise be entitled pursuant to this Section 9.5(b)(i) and (y) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount, and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claim. In the event of a Breach by a particular Seller under Section 8.2(b), indemnification for such Breach will be satisfied solely by such Seller (including from such Seller’s Pro Rata Percentage of the Non-Public Stockholder Indemnification Escrow Amount)Parent Common Stock Price.
(bii) Claims If payment is to be made to the Exchange Agent from the Escrow Fund pursuant to Section 9.4(e)(iii) or the last sentence of Section 9.4(e)(iv), Parent and the Stockholder Representative shall promptly deliver joint written instructions to the Escrow Agent directing the Escrow Agent to release to the Exchange Agent the number of shares of Parent Common Stock (rounded down to the nearest whole share) so payable plus a pro rata portion (based on the amount of such reduction of the Escrow Fund relative to the number of shares of Parent Common Stock in the Escrow Fund immediately before such release) of all amounts in the Escrow Fund that exceed the Escrow Stock Amount as of immediately before such release (i.e., earnings (including interest and dividends) on the Escrow Stock Amount and on any such earnings in accordance with the Escrow Agreement) (and the Exchange Agent shall then promptly distribute such cash, if any, and shares of Parent Common Stock to each such Company Stockholder so that each such Company Stockholder receives such amount attributable to it, him or her); provided, that (A) no fractional shares shall be distributed by the Buyer Indemnified Persons for indemnification under clause Exchange Agent to any Company Stockholder, (ivB) or (v) any fraction of Section 8.2(a) a share of Parent Common Stock to which such Company Stockholder would otherwise be entitled shall be satisfied first paid in cash in accordance with Section 2.8(j), and (C) any shares that remain undistributed by the Escrow Agent as a result of this proviso shall be returned by the Escrow Agent to Parent.
(iii) Notwithstanding anything to the contrary in this Agreement, to the extent that any distribution of shares of Parent Common Stock from the Litigation Escrow Amount andFund to a Company Stockholder would, if in the Litigation Escrow Amount is insufficient reasonable discretion of Parent, fail to satisfy such claim for indemnificationcomply with applicable securities laws, then, upon the receipt of notice from Parent, the Escrow Agent shall distribute such shares from the Escrow Fund to Parent and Parent shall pay such Company Stockholder an amount in cash equal to the product of (x) directly from Compass for Compass’ Pro Rata Percentage the number of shares of Parent Common Stock to which such claim Indemnifying Holder would otherwise be entitled pursuant to this Article IX and (y) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claimParent Common Stock Price.
(c) Claims made by the Buyer Indemnified Persons for indemnification under Section 6.2(d) shall be governed by such section.
Appears in 1 contract
Satisfaction of Claims. If any indemnification claim pursuant to Section 8.2 is required to be paid directly by an Indemnifying Party during the six month period following the date of this Agreement, the following provisions shall apply with respect to the payment and satisfaction of such claim: (aA) Claims made if the Indemnifying Party received any portion of the Merger Consideration in cash (i) then any indemnifiable Losses pursuant to this Article VIII payable to an Indemnified Party will first be required to be paid by such Indemnifying Party in cash up to the Buyer amount of cash that such Indemnifying Party received as Merger Consideration and (ii) thereafter, the Indemnifying Party will be permitted to satisfy such indemnification claim either (at the election of the Indemnifying Party) in cash or through the forfeiture of shares of Parent Common Stock received as Merger Consideration; and (B) if the Indemnifying Party received its entire portion of the Merger Consideration in shares of Parent Common Stock, then any indemnifiable Losses pursuant to this Article VIII payable to an Indemnified Persons for Party may be satisfied either (at the election of the Indemnifying Party) in cash or through the forfeiture of shares of Parent Common Stock received as Merger Consideration. The foregoing sentence shall not apply with respect to any indemnification under claim pursuant to Section 8.2 that is required to be paid directly by an Indemnifying Party after the six month period following the date of this Agreement. A claim being satisfied through the forfeiture of shares of Parent Common Stock will not be deemed satisfied until the Indemnifying Party has executed the documents required by Parent’s transfer agent to effectuate such forfeiture (including stock powers with respect to such forfeited shares). Any such shares of Parent Common Stock forfeited pursuant to this Section 8 (other than claims made under clause (iv) or (v) of Section 8.2(a)8.2(a)(vi) shall be satisfied (x) directly from Compass valued at the Trading Price for Compass’ Pro Rata Percentage purposes of such claim and (y) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount, and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claim. In the event of a Breach by a particular Seller under Section 8.2(b), indemnification for such Breach will be satisfied solely by such Seller (including from such Seller’s Pro Rata Percentage of the Non-Public Stockholder Indemnification Escrow Amount)forfeiture.
(b) Claims made by the Buyer Indemnified Persons for indemnification under clause (iv) or (v) of Section 8.2(a) shall be satisfied first from the Litigation Escrow Amount and, if the Litigation Escrow Amount is insufficient to satisfy such claim for indemnification, then, (x) directly from Compass for Compass’ Pro Rata Percentage of such claim and (y) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claim.
(c) Claims made by the Buyer Indemnified Persons for indemnification under Section 6.2(d) shall be governed by such section.
Appears in 1 contract
Samples: Agreement and Plan of Reorganization (Fusion-Io, Inc.)
Satisfaction of Claims. (a) Claims made Damages for which any Purchaser Indemnified Person shall be entitled to indemnification or payment pursuant to this Section 9 (to the extent Finally Determined), other than pursuant to Section 9.2(b)(vi), shall be satisfied (subject, in each case, to the applicable limitations of this Agreement) in the following order: first, the Holdback Amount shall reduced (but not below zero), on a dollar-for-dollar basis, by the Buyer Indemnified Persons for indemnification under this Section 8 amount of such Damages, and, second, to the extent the amount of such reduction is less than the amount of such Damages, the difference shall be paid by the Significant Shareholder (other than claims made under clause (iv) or (v) up to the General Rep Cap and to the Special Cap, to the extent such limitations are applicable thereto pursuant to the provisions of Section 8.2(a9.2(c)(iii)) to the Purchaser Indemnified Person by wire transfer of immediately available funds, no later than five (5) Business Days following the Significant Shareholder’s receipt of written wire instructions from Purchaser with respect thereto.
(b) Damages for which any Purchaser Indemnified Person shall be entitled to indemnification or payment pursuant to Section 9.2(b)(vi) (to the extent Finally Determined) shall be satisfied (xsubject, in each case, to the applicable limitations of this Agreement) directly from Compass for Compass’ Pro Rata Percentage in the following order: first, by the wire transfer in immediately available funds of such claim and (y) amount in accordance with respect to Sellers other than Compassthe written wire instructions of the Purchaser Indemnified Person, from (and to the Non-Public Stockholder Indemnification extent of) the Escrow AmountFunds in the Escrow Account (and, within three (3) Business Days after the Purchaser Indemnified Person delivers such instructions to the Holders’ Agent, Purchaser and if the Non-Public Stockholder Indemnification Holders’ Agent shall execute and deliver joint written instructions to the Escrow Amount Agent to cause the Escrow Agent to make such payment); and second, to the extent the amount of such release or disbursement from the Escrow Funds is insufficient less than the amount of such Damages, the difference shall be paid, at the Purchaser’s election (in its sole discretion, by written notice thereof to satisfy such claim for indemnification, then directly from Sellers (other than Compassthe Significant Shareholder), severally and not jointly for such Seller’s Pro Rata Percentage of such claim. In the event of a Breach by a particular Seller under Section 8.2(b), indemnification for such Breach will be satisfied solely by such Seller (including from such Seller’s Pro Rata Percentage of the Non-Public Stockholder Indemnification Escrow Amount).
(b) Claims made by the Buyer Indemnified Persons for indemnification under clause (iv) or (v) of Section 8.2(a) shall be satisfied first from the Litigation Escrow Amount and, if the Litigation Escrow Amount is insufficient to satisfy such claim for indemnification, thenwithout duplication, (x) directly from Compass for Compass’ Pro Rata Percentage by the reduction of the Holdback Amount (but not below zero), on a dollar-for-dollar basis, by the amount of such claim and difference (to the extent specified in such notice) and/or (y) by the Significant Shareholder (up to the General Rep Cap and to the Special Cap, to the extent such limitations are applicable thereto pursuant to the provisions of Section 9.2(c)(iii)) to the Purchaser Indemnified Person by wire transfer of immediately available funds in the amount of such difference (to the extent specified in such notice), no later than five (5) Business Days following the Significant Shareholder’s receipt of written wire instructions from Purchaser with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claimthereto.
(c) Claims made by the Buyer Indemnified Persons for indemnification under Section 6.2(d) shall be governed by such section.
Appears in 1 contract
Samples: Merger Agreement (Vangent, Inc.)
Satisfaction of Claims. (ai) Claims made Subject to Section 6.5 hereof, any claims by the Buyer a Parent Indemnified Persons Party for indemnification of Losses claimed under this Section 8 6.2(a) to which such Parent Indemnified Party becomes entitled pursuant to the provisions of Sections 6.3(b) through (other than claims made under clause (ive) below or (v) by final, non-appealable order of Section 8.2(a)) a court of competent jurisdiction shall be satisfied (xA) directly first, by setting-off against and deducting the amount of such Losses from Compass for Compass’ any and all Deferred Payments, and (B) only if and to the extent the Deferred Payments are not sufficient to pay such Losses in full, each Shareholder shall pay to the Parent Indemnified Party, by wire transfer of immediately available funds to an account or accounts designated by Parent (subject to the next sentence of this Section 6.3(a)(i)), its, his or her Pro Rata Percentage Portion of any such indemnification claim which is not satisfied pursuant to the foregoing clause (A); provided, however that if a Shareholder becomes obligated to pay to a Parent Indemnified Party its, his or her Pro Rata Portion of any indemnification claim pursuant to clause (B) above at any time while any shares of Purchaser Common Stock received by such Shareholder as part of the Merger Consideration remain subject to the restrictions on transfer set forth in Section 12 of the Stockholders’ Agreement, then fifty-five percent (55%) of such claim payment obligation shall be satisfied by transferring and (y) with respect delivering to Sellers other than Compassthe Parent shares of Parent Common Stock, from which will for these purposes be valued at the Non-Public Stockholder Indemnification Escrow AmountSigning Date Price, and if forty-five percent (45%) shall be payable by wire transfer of immediately available funds to an account designated by the Non-Public Stockholder Indemnification Escrow Amount is insufficient Parent. If the indemnifying Shareholder does not own a sufficient number of shares of Parent Common Stock to satisfy such claim for indemnificationmeet the foregoing requirement, then directly from Sellers (other than Compass)he, severally she or it shall deliver all shares of Parent Common Stock then owned by the Shareholder to the Parent Indemnified Party and not jointly for such Sellerthe balance of that Shareholder’s Pro Rata Percentage Portion shall be payable by wire transfer of immediately available funds to an account designated by the Parent.
(ii) Any amounts payable to Parent Indemnified Party pursuant to Section 6.2(b) to which such claim. In Parent Indemnified Party becomes entitled pursuant to the event provisions of Sections 6.3(b) through (e) below or by final, non-appealable order of a Breach court of competent jurisdiction shall be payable by the Company to the Parent by wire transfer of immediately available funds to an account or accounts designated by the Parent.
(iii) Any amounts payable to the Securityholder Indemnified Parties pursuant to Section 6.2(c) to which such Securityholder Indemnified Party becomes entitled pursuant to the provisions of Sections 6.3(b) through (e) below or by final, non-appealable order of a particular Seller under Section 8.2(b)court of competent jurisdiction shall be payable by the Parent to the Securityholder Representative, indemnification for such Breach will be satisfied solely by such Seller (including from such Seller’s Pro Rata Percentage on behalf of the Nonapplicable Securityholder Indemnified Parties, by wire transfer of immediately available funds to an account or accounts designated by the Securityholder Representative, to be disbursed to the applicable Securityholder Indemnified Parties by the Securityholder Representative; provided, however, upon written notice by the Securityholder Representative to Parent, Parent shall limit the amount payable to the Securityholder Representative to the extent that such payment would result in less than 40% “continuity of interest” under Treasury Regulation Section 1.368-Public Stockholder Indemnification Escrow Amount1(e).
(b) Claims made by the Buyer Indemnified Persons for indemnification under clause (iv) or (v) of Section 8.2(a) Any payment for Losses pursuant to this Article VI shall be satisfied first from treated as an adjustment to the Litigation Escrow Amount and, if the Litigation Escrow Amount is insufficient to satisfy such claim for indemnification, then, (x) directly from Compass for Compass’ Pro Rata Percentage of such claim and (y) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claimMerger Consideration.
(c) Claims made by the Buyer Indemnified Persons for indemnification under Section 6.2(d) shall be governed by such section.
Appears in 1 contract
Satisfaction of Claims. (a) Claims made Each claim for indemnification by Acquiror Indemnified Persons, including under this Article XI, that is agreed to or approved by the Buyer Indemnified Persons for indemnification under this Section 8 (other than claims made under clause (iv) or (v) of Section 8.2(a)) Stockholder prior to the Second Payment Date; any Revenue Shortfall Claim; any Unpaid Taxes Claim; and any Excess Debt Claim shall be satisfied by offset against the First Payment Amount (x) directly from Compass for Compass’ Pro Rata Percentage of or, if such claim and is not made (yor agreed to or approved, if applicable) with respect prior to Sellers other than Compassthe First Payment Date, from against the Non-Public Stockholder Indemnification Escrow Amount, and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claim. In the event of a Breach by a particular Seller under Section 8.2(b), indemnification for such Breach will be satisfied solely by such Seller (including from such Seller’s Pro Rata Percentage of the Non-Public Stockholder Indemnification Escrow Second Payment Amount).
(b) Claims In the event one or more claims for indemnification made by the Buyer Acquiror Indemnified Persons for indemnification (which claims shall be made in good faith, providing a detailed explanation of the basis of such claim), including under clause this Article XI, are not agreed to or approved by the Stockholder prior to the Second Payment Date, Acquiror may withhold a portion of the Second Payment equal to the lesser of the aggregate amount of such claims and $500,000, and place it into escrow under the terms of the Escrow Agreement (iv) or the "Escrow Agreement"), a form of which is attached hereto as Exhibit A, to be entered into in such event at the Second Payment Date by and among Acquiror, Swiftcall E&S, the Stockholder and the Escrow Agent named therein (v) of Section 8.2(athe "Escrow Agent"). The amount deposited into escrow (the "Escrow Amount") shall be satisfied first from held by the Litigation Escrow Agent in escrow until the final resolution thereof. The Acquiror shall have the option to deliver the Escrow Amount and, if in Acquiror Common Stock (the Litigation Escrow Amount is insufficient to satisfy such claim for indemnification, then, (xnumber of shares of which shall be determined in the same manner as the Second Payment Amount) directly from Compass for Compass’ Pro Rata Percentage or cash. Any Acquiror Common Stock delivered as part of such claim and (y) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount and if ultimately applied toward satisfaction of any claim against the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnificationescrow shall be valued, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage purpose, at the Market Price of such claimthe Acquiror Common Stock on the Second Payment Date.
(c) Claims made Nothing in this Article XI shall preclude any Acquiror Indemnified Person from pursuing the resolution of an indemnification claim in any federal or state court, nor shall any Acquiror Indemnified Person be required to pursue such indemnification claim through arbitration or any other alternative dispute resolution process. However, in the event any amounts are placed in escrow following a claim, the claiming party shall pursue resolution of such claim diligently with a view to obtaining a prompt resolution of the matter.
(d) In the event of an allocation under Section 2.1(e), any claim shall be allocated against, and deducted from, the First Payment Amount and the Second Payment Amount in the same proportions as contemplated by the Buyer Indemnified Persons for indemnification allocation of the Purchase Price under Section 6.2(d) shall be governed by such section2.1(e).
Appears in 1 contract
Samples: Merger Agreement (Eglobe Inc)
Satisfaction of Claims. (ai) Claims made If a Notice of Claim is given during the term hereof and Interland and the Escrow Agent do not receive, within 30 business days after the Notice of Claim was received by the Buyer Indemnified Persons Escrow Agent, a notice from the Shareholders (the "Shareholders' Notice") stating that a dispute (the "Dispute") exists relating to the Notice of Claim and the basis of such Dispute in reasonable detail to enable Interland to evaluate the Dispute, Escrow Agent shall promptly, on the 31st business day after the Escrow Agent's receipt of the Notice of Claim, release from escrow for indemnification under this Section 8 transfer to Interland that number of Escrow Shares equal to the quotient of (other than claims made under clause A) the Claim Amount, divided by (ivB) or the average last reported price per share of Interland common stock (vas reported in The Wall Street Journal) (the "Market Price") for the last ten (10) trading days immediately preceding the 31st business day after the Escrow Agent's receipt of Section 8.2(a)the relevant Notice of Claim.
(ii) If Interland and Escrow Agent receive a Shareholders' Notice within such 30 business day period, Escrow Agent shall continue to hold the Escrow Shares until such Dispute is resolved (provided, however, that in such event the Market Price shall be satisfied the average closing price per share of Interland common stock as reported in The Wall Street Journal for the last ten (x10) directly from Compass for Compass’ Pro Rata Percentage trading days immediately preceding the receipt by Escrow Agent of the Shareholders' Notice). Interland and the Shareholders shall attempt in good faith to resolve the Dispute. If Interland and Shareholders are able to resolve such Dispute, they shall jointly notify Escrow Agent of such claim resolution and (y) Escrow Agent shall promptly release from escrow for transfer to Interland that number of Escrow Shares agreed upon by Interland and Shareholders as set forth in the joint notice, which Interland and Shareholders hereby agree shall equal to the quotient of the final amount Interland and Shareholders determine is owed to Interland, if any, divided by the Market Price. If the Shareholders and Interland fail to resolve the Dispute within 30 calendar days after Interland and Escrow Agent receive the Shareholders' Notice, the Dispute may at any time thereafter be submitted by Interland or the Shareholders to arbitration in Atlanta, Georgia before a single arbitrator reasonably acceptable to both Interland and the Shareholders in accordance with the Commercial Arbitration Rules of the American Arbitration Association then in effect. Interland and the Shareholders will equally split the cost of the arbitration filing and hearing fees, and the arbitrator will have authority to award attorneys' fees to the prevailing party. Interland and the Shareholders agree that the arbitrator's award shall be final and binding upon them with respect to Sellers other than Compassthe Dispute and judgment may be entered thereon in any court having jurisdiction thereof; provided, from however, that notwithstanding any provision contained herein to the Non-Public Stockholder Indemnification Escrow Amount, contrary the parties hereto may settle any dispute by mutual agreement at any time. Interland and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage Shareholders agree that promptly after the issuance of such claim. In final award by the event arbitrator, Escrow Agent shall release from escrow for transfer to Interland that number of a Breach by a particular Seller under Section 8.2(b), indemnification for such Breach will be satisfied solely by such Seller (including from such Seller’s Pro Rata Percentage Escrow Shares equal to the quotient of the Non-Public Stockholder Indemnification Escrow Amount).
(b) Claims made final amount of such award that was awarded to Interland by the Buyer Indemnified Persons for indemnification under clause (iv) or (v) of Section 8.2(a) shall be satisfied first from the Litigation Escrow Amount andarbitrator, if the Litigation Escrow Amount is insufficient to satisfy such claim for indemnificationany, then, (x) directly from Compass for Compass’ Pro Rata Percentage of such claim and (y) with respect to Sellers other than Compass, from the Non-Public Stockholder Indemnification Escrow Amount and if the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claim.
(c) Claims made divided by the Buyer Indemnified Persons for indemnification under Section 6.2(d) shall be governed by such sectionMarket Price.
Appears in 1 contract
Satisfaction of Claims. (a) Claims made by the Buyer Indemnified Persons for indemnification under pursuant to this Section 8 (other than claims made under clause (iv) or (v) of Section 8.2(a)) 7.1 shall be satisfied (xi) directly first, from Compass for Compass’ Pro Rata Percentage the Indemnification Holdback Amount, to the extent of such claim the amount then remaining thereof, (ii) second, and (y) solely to the extent the Buyer Indemnitees are entitled to indemnification in excess of the Indemnification Holdback Amount with respect to Sellers other than Compasssuch claim pursuant to the provisions of this Section 7.1, directly against Seller and the Principal Members, jointly and severally and (iii) third, solely to the extent the Buyer Indemnitees are entitled to indemnification in excess of the Indemnification Holdback Amount with respect to such claim pursuant to the provisions of this Section 7.1, by setting off any such amounts against (A) any Earnout Payments (resulting in a reduction of such Earnout Payments), if any, as such Earnout Payments become due and payable pursuant Section 2.6 and (B) Payable Consent Pro-Rata Amounts, if any, as such Payable Consent-Pro Rata Amounts become due and payable pursuant to Section 2.5; provided, however, that, notwithstanding the foregoing or the provisions of Section 7.1(b)(ii), claims or recoveries in respect of any fraud or intentional misrepresentation by Seller or any Principal Member of a representation or warranty contained in this Agreement, in the sole and absolute discretion of the Buyer Indemnitees, either or in combination (w) from the Non-Public Stockholder Indemnification Escrow Amount, and if the Non-Public Stockholder Indemnification Escrow Holdback Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers (other than Compass), severally and not jointly for such Seller’s Pro Rata Percentage of such claim. In the event of a Breach by a particular Seller under Section 8.2(b), indemnification for such Breach will be satisfied solely by such Seller (including from such Seller’s Pro Rata Percentage of the Non-Public Stockholder Indemnification Escrow Amount).
(b) Claims made by the Buyer Indemnified Persons for indemnification under clause (iv) or (v) of Section 8.2(a) shall be satisfied first from the Litigation Escrow Amount and, if the Litigation Escrow Amount is insufficient to satisfy such claim for indemnification, then, (x) directly from Compass for Compass’ Pro Rata Percentage of such claim against Seller and each Principal Member, jointly and severally, (y) with respect by setoff against any Earnout Payments that may become due and payable pursuant to Sellers other than CompassSection 2.6 or (z) by set off against any Payable Consent Pro-Rata Amount that may become due and payable pursuant to Section 2.5. Notwithstanding anything to the contrary herein, from the Non-Public Stockholder Indemnification Escrow Amount and if aggregate liability of each Member for Losses shall be limited to the Non-Public Stockholder Indemnification Escrow Amount is insufficient to satisfy such claim for indemnification, then directly from Sellers product of (other than Compass), severally and not jointly for such SellerA) each Member’s Pro Rata Percentage Amount multiplied by (B) the Purchase Price; provided, however, that Losses for fraud or intentional misrepresentation of such claim.
(c) Claims made by the Buyer Indemnified Persons for indemnification under Section 6.2(d) a Member shall be governed by unlimited for such sectionMember.
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