EX. 10.3
INDEMNIFICATION AGREEMENT
INDEMNIFICATION AGREEMENT, dated as of _____________, 2002, by and between
Xxxxx Xxx ("INDEMNITOR"), an individual with an address of 000 Xxxxxxxxxxxx
Xxxx, Xxxxxxx, Xxxxxxxxxxxx 00000, and ELECTRONICS BOUTIQUE OF AMERICA INC., a
Pennsylvania corporation ("INDEMNITEE").
BACKGROUND:
A. Indemnitee and Sports Collectibles, Inc., a Delaware corporation
("BUYER"), are parties to an Asset Purchase Agreement, dated as of October 10,
2002 (the "Asset Purchase Agreement"), pursuant to which Buyer has agreed to
purchase from Indemnitee, and Indemnitee has agreed to sell to Buyer, the 22
sports memorabilia and collectibles retail stores owned and operated by
Indemnitee under the name "BC Sports Collectibles". All capitalized terms not
otherwise defined herein shall have the meanings ascribed to such terms in the
Asset Purchase Agreement.
B. As a condition to the consummation of the transactions contemplated by
the Asset Purchase Agreement, Indemnitee has required that Indemnitor indemnify,
defend and hold Indemnitee harmless from and against any all Assumed Liabilities
relating to the Leases, and Indemnitor is willing to do so, as set forth in this
Agreement.
Accordingly, in consideration of the mutual agreements contained herein,
and intending to be legally bound hereby, the parties hereto agree as follows:
1. INDEMNIFICATION. From and after the Effective Time, Indemnitor shall
indemnify, defend and hold harmless Indemnitee (and its officers, directors,
stockholders, employees, agents, affiliates, successors and assigns) (each, an
"INDEMNIFIED PARTY") from and against any and all liabilities, claims, demands,
judgments, losses, costs, damages or expenses whatsoever (including reasonable
attorneys', consultants' and other professional fees and disbursements of every
kind, nature and description incurred by such Indemnified Party in connection
therewith) (collectively, "DAMAGES") that such Indemnified Party may sustain,
suffer or incur and that result from, arise out of or relate to (a) the
nonfulfillment by Buyer of any of the Assumed Liabilities relating to the
Leases, and (b) any and all actions, suits, claims, proceedings, investigations,
allegations, demands, assessments, audits, fines, judgments, costs and other
expenses (including, without limitation, reasonable attorneys' fees and
expenses) incident to any of the foregoing or to the enforcement of this
Agreement.
2. INDEMNIFICATION PROCEDURES. The obligations and liabilities of
Indemnitor under this Agreement shall be subject to the following terms and
conditions:
a. The Indemnified Party shall give written notice to the
Indemnitor of any Damages with respect to which it seeks indemnification
promptly after the discovery by the Indemnified Party of any matters giving rise
to such claim for indemnification; PROVIDED, HOWEVER, that the failure of the
Indemnified Party to give notice as provided herein shall not relieve the
Indemnitor of its obligations under this Agreement unless the Indemnitor shall
have been materially prejudiced by the failure to provide such notice.
b. In case any claim, action, suit, proceeding or
investigation (each, a "Claim") is brought against an Indemnified Party, the
Indemnitor shall be entitled to participate in the defense thereof and, to the
extent that he may wish, to assume the defense thereof, with counsel reasonably
satisfactory to the Indemnified Party, and after notice from the Indemnitor of
its election so to assume the defense thereof, the Indemnitor will not be liable
to the Indemnified Party under this Agreement for any legal or other expense
subsequently incurred by the Indemnified Party in connection with the defense
thereof; PROVIDED, HOWEVER, that (i) if the Indemnitor shall elect not to assume
the defense of such Claim or (ii) if the Indemnified Party reasonably determines
that there may be a conflict between the positions of the Indemnitor and the
Indemnified Party in defending such Claim, then separate counsel shall be
entitled to participate in and conduct such defense, and the Indemnitor shall be
liable for any reasonable legal or other expenses incurred by the Indemnified
Party in connection with such defense (but not more than one counsel).
c. The Indemnitor shall not be liable for any settlement of
any Claim effected without its written consent, which consent shall not be
unreasonably withheld. The Indemnitor shall not, without the Indemnified Party's
prior written consent, which consent shall not be unreasonably withheld, settle
or compromise any Claim to which the Indemnified Party is a party or consent to
entry of any judgment in respect thereof. The Indemnitor further agrees that it
will not, without the Indemnified Party's prior written consent, settle or
compromise any Claim or consent to entry of any judgment in respect thereof in
any pending or threatened Claim in respect of which indemnification may be
sought hereunder (whether or not the Indemnified Party is an actual or potential
party to such Claim) unless such settlement or compromise includes an
unconditional release of the Indemnified Party from all liability arising out of
such Claim.
3. PARTIES IN INTEREST. This Agreement shall be binding upon, inure to the
benefit of, and be enforceable by the respective successors and assigns of the
parties hereto. The rights and obligations of the Indemnitor, on the one hand,
and the Indemnitee, on the other hand, hereunder may not be assigned without the
consent of the other party hereto.
4. ENTIRE AGREEMENT, AMENDMENTS AND WAIVER.
(a) This Agreement contains the entire understanding of the parties
with respect to its subject matter. This Agreement supersedes all prior
understandings and agreements or representations by or between the Indemnitee
(or any Affiliate) and the Indemnitor with respect to its subject matter.
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(b) This Agreement may be amended only by a written instrument duly
executed by the parties. Any condition to a party's obligations hereunder may be
waived in writing by such party to the extent permitted by law.
5. HEADINGS. The Article and Section headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
6. NOTICES. All notices, claims, certificates, requests, demands and other
communications hereunder shall be in writing and shall be deemed to have been
duly given if delivered personally, by telex or facsimile transmission (with
written confirmation of receipt) or mailed (registered or certified mail,
postage prepaid, return receipt requested) as follows:
If to Indemnitor to: Xxxxx Xxx
000 Xxxxxxxxxxxx Xxxx
Xxxxxxx, XX 00000
Facsimile No.: (000) 000-0000
with copies to: Xxxxx & Xxxxxxx, P.C.
Three Glenhardie Corporate Center
0000 Xxxxxxxx Xxxx, Xxxxx 000
Xxxxx, XX 00000
Attention: Xxxxxx X. Xxxxx, Esquire
Facsimile No.: (000) 000-0000
If to Indemnitee: Electronics Boutique of America Inc.
000 Xxxxx Xxxxxxx Xxxxxx
Xxxx Xxxxxxx, XX 00000
Attention: General Counsel
Facsimile No.: (000) 000-0000
with a copy to: Klehr, Harrison, Xxxxxx, Branzburg & Xxxxxx LLP
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxx, Esq.
Facsimile No.: (000) 000-0000
or to such other address as the person to whom notice is to be given may have
previously furnished to the others in writing in the manner set forth above,
provided that notice of a change of address shall be deemed given only upon
receipt. Notice by counsel for a party shall constitute notice by such party.
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7. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the Commonwealth of Pennsylvania without regard
to any applicable conflicts of law.
8. JURY TRIAL WAIVER; JURISDICTION. EACH PARTY HERETO WAIVES TRIAL BY JURY
WITH RESPECT TO ANY ACTION BROUGHT, OR CLAIM MADE, REGARDING, OR IN CONNECTION
WITH, THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. Each party hereto
hereby agrees that any legal action or proceeding with respect to this Agreement
or for recognition and enforcement of any judgment in respect hereof brought by
any other party hereto or its successors or assigns may be brought and
determined in the state and federal courts of the Commonwealth of Pennsylvania,
and submits with regard to any such action or proceeding for itself and in
respect to its property, generally and unconditionally, to the exclusive
jurisdiction of such courts, and agrees that service of process in any such
action or proceeding shall be effective if mailed to such party as provided in
Section 6. Each party hereto irrevocably waives, and agrees not to assert, by
way of motion, as a defense, counterclaim or otherwise, in any action or
proceeding with respect to this Agreement (a) any claim that it is not
personally subject to the jurisdiction of such courts for any reason, (b) that
it or its property is exempt or immune from jurisdiction of any court or from
any legal process commenced in such courts (whether through service of notice,
attachment prior to judgment, attachment in aid of execution of judgment,
execution of judgment or otherwise), and (c) to the fullest extent permitted by
applicable law, that (i) the suit, action or proceeding in any such court is
brought in an inconvenient forum, (ii) the venue of such suit, action or
proceeding is improper and (iii) this Agreement, or the subject matter hereof,
may not be enforced in or by such courts.
9. COUNTERPARTS. This Agreement may be executed simultaneously in
several counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
10. CONSTRUCTION. The Indemnitor and the Indemnitee have participated
jointly in the negotiation and drafting of this Agreement. In the event an
ambiguity or question of intent or interpretation arises, this Agreement will be
construed as if drafted jointly by the parties hereto and no presumption or
burden of proof will arise favoring or disfavoring any party by virtue of the
authorship of any of the provisions of this Agreement.
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IN WITNESS WHEREOF, the Indemnitor and the Indemnitee have caused this
Indemnification Agreement to be executed by their duly authorized
representatives as of the date first written above.
ELECTRONICS BOUTIQUE OF AMERICA INC.
By: ___________________________
Name:
Title:
_________________________________
XXXXX XXX
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