INDEMNIFICATION AGREEMENT
Exhibit 4.36
EXECUTION COPY
This Indemnification Agreement is entered into as of May 18, 2010 by and among eLong, Inc., an
exempted limited liability company organized under the laws of the Cayman Islands (the
“Company”), eLongNet Information Technology (Beijing) Co., Ltd., a company organized under
the laws of the People’s Republic of China (the “eLongNet”), Expedia, Inc., a company
organized under the laws of the State of Washington, USA (“Expedia”), and Expedia Asia
Pacific-Alpha Limited, an exempted limited liability company organized under the laws of the Cayman
Islands (“Expedia Asia Pacific”). Capitalized terms used herein but not defined shall have
the meanings set forth in the Stock Purchase Agreement.
RECITALS
WHEREAS, Expedia Asia Pacific, Xxxxxx Xxxx and Purple Mountain Holding Ltd. (“Seller”,
and together with Xxxxxx Xxxx, the “Sellers”) have entered into a Stock Purchase Agreement
and Securities Pledge Agreement, dated as of even date hereof; and Expedia Asia Pacific, Xxxxxx
Xxxx, Purple Mountain and CSC Trust Company of Delaware have entered into a Securities Escrow
Agreement, dated as of even date hereof (together with the Stock Purchase Agreement and Securities
Pledge Agreement, the “Agreements”);
WHEREAS, under the Agreements, Seller has agreed to sell and Expedia Asia Pacific has agreed
to buy 2,400,000 ordinary shares, par value $0.01 per share, of the Company, which shares are
issuable to Seller upon the exercise of certain stock options held by Seller (the “Purchased
Shares”);
WHEREAS, under the Agreements, Sellers have agreed to certain indemnification obligations in
favor of Expedia Asia Pacific and its affiliates (including the Company and eLongNet), and Sellers
have also agreed to pledge all securities of the Company owned by, issued to, or to be issued to
any of them as security for certain obligations of the Sellers under the Agreements;
WHEREAS, Expedia Asia Pacific and Expedia now wish to provide certain additional
indemnification rights in favor of the Company and eLongNet;
NOW, THEREFORE, in consideration of the premises and mutual covenants and agreements herein
contained, and for other good and valuable consideration including the Company’s delivery of shares
under the Agreements, the parties hereto hereby agree as follows:
| 1. | In addition to the indemnification obligations of the Sellers under the Stock Purchase
Agreement that shall be available to the Company and eLongNet (each an “Indemnified
Party” and together the “Indemnified Parties”), Expedia Asia Pacific and Expedia
(each and “Indemnifying Party” and together the “Indemnifying Parties”) shall
be liable to and shall indemnify, defend and hold the Indemnified Parties harmless from and
against any
and all claims, demands, actions, causes of action, government inquiries, judgments,
damages, losses, liabilities, adverse determinations or regulatory findings, costs or
expenses (each a “Loss” and collectively, the “Losses”) which any
Indemnified Party may suffer or incur as a result of, arising out of or relating to Taxes
(as defined in the Stock Purchase Agreement) relating to the Purchased Shares and/or the
Pledged Shares. |
| 2. | Upon obtaining knowledge of any Loss, a Director or Company Officer of an Indemnified Party
shall promptly notify the Indemnifying Parties by providing a written description, which shall
be in the form of Annex A hereto (each, an “Indemnified Loss Notice”) setting
forth in reasonable detail, the nature and estimated amount in RMB (as well as US dollars) of
the Loss. After conducting a prima facie review of the form of the Indemnified Loss Notice,
if the Loss amount is less than US$50,000, within 10 calendar days after receipt of the
Indemnified Loss Notice, the Indemnifying Parties will pay to the Indemnified Parties by wire
transfer of immediately available funds to an account designated in the Indemnified Loss
Notice the amount set forth in the Indemnified Loss Notice; provided that, if the Loss amount
is greater than US$50,000, the payment shall be made within 45 calendar days. |
| 3. | With respect to any Loss set forth in a Indemnified Loss Notice, the Indemnified Parties
shall not settle or compromise any claim, suit or action relating to the Loss without the
written consent of the Indemnifying Parties, and the Indemnifying Parties and Sellers shall
have the right to be informed of, and consulted with in respect to, any communications of the
Indemnified Parties with governmental taxing authorities relating to any claim, inquiry or
other matter which may result in a Loss. The Company and eLongNet shall make available to
Expedia, Expedia Asia Pacific and their representatives all records and other materials
reasonably related to any Loss. |
| 4. | With respect to any Loss, if any Indemnified Party or Indemnifying Party, initiates a claim
against Sellers under the indemnification provisions of the Agreements, the other Indemnified
Parties and Indemnifying Parties shall use all reasonable efforts to assist the party seeking
indemnification from Sellers, including but not limited to providing copies of all
correspondence, pleadings, motions, briefs, appeals or other written statements relating to or
submitted in connection with the claim against Sellers. In the event that an Indemnified
Party recovers any Loss from Seller that, when added to any amount that has been paid by an
Indemnifying Party in respect of such Loss, results in the Indemnified Party receiving an
amount in excess of such Loss, the Indemnified Party will promptly repay the amount of such
excess recovery to the Indemnifying Party. |
| 5. | This agreement shall terminate on the fifth anniversary of the date hereof. |
| 6. | This agreement shall be governed by and construed and enforced in accordance with the laws of
the State of Delaware, without reference to the conflict of laws principles thereof. Any
dispute, controversy or claim arising out of or relating to this agreement which the parties
fail to amicably resolve, shall be settled by arbitration in Hong Kong under the Hong Kong
International Arbitration Centre Administered Arbitration Rules in force when the Notice of
Arbitration is submitted in accordance with these Rules. |
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date written above.
| ELONG, INC. | EXPEDIA, INC. | |||||||||||||
| By: | /s/ Xxxx Xxxxxx | By: | /s/ Xxxx Xxxxxxxxx | |||||||||||
| Name: | Xxxx Xxxxxx | Name: | Xxxx Xxxxxxxxx | |||||||||||
| Title: | General Counsel | Title: | Senior Vice President, Corporate Development | |||||||||||
| ELONGNET INFORMATION | EXPEDIA ASIA PACIFIC-ALPHA LIMITED | |||||||||||||
| TECHNOLOGY (BEIJING) CO., LTD. | ||||||||||||||
| By: | /s/ Xxxx Xxxxxx | By: | /s/ Xxxxx X. Xxxxxx | |||||||||||
| Name: | Xxxx Xxxxxx | Name: | Xxxxx X. Xxxxxx | |||||||||||
| Title: | General Counsel | Title: | Director | |||||||||||
